A search and matching model, when calibrated to the mean and volatility of unemployment in the postwar sample, can … potentially explain the unemployment crisis in the Great Depression. The limited responses of wages from credible bargaining to … labor market conditions, along with the congestion externality from matching frictions, cause the unemployment rate to rise …

fluctuations of vacancies and unemployment in our model can replicate those observed in the US data, with labour market tightness … for the new hires and the calibration is consistent with the estimated elasticity of unemployment to unemployment benefits …

unemployment rates, is a good start to understanding the unemployment crisis in the Great Depression. Drawing from rarely used data … sources, this paper compiles historical monthly time series of U.S. unemployment rates, vacancy rates, and labor productivity …, some of which date back to 1890. The frequency, persistence, and severity of the unemployment crises in the model are …