In this paper, I show that the decline in household consumption during unemployment spells depends on both liquid and … illiquid asset positions. I also provide evidence that unemployment spells predict the withdrawal of illiquid assets …, particularly when households have few liquid assets. Motivated by these findings, I embed endogenous unemployment risk in a two …

in their unemployment rate and not a decline in labour force participation rate. Policymakers should take account of …

We investigate both theoretically and empirically how unemployment level and its growth affect future stock returns. We … find that both a higher unemployment rate and higher growth of unemployment positively predict future stock market returns … reinforce each other making stock returns exceptionally high in periods of high unemployment and high unemployment growth. Our …