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We consider the effects of quantitative easing on liquidity and prices of bonds in a search- and matching model. The … calibrate the model to the euro area and show how yields and liquidity are affected by the European Central Banks asset purchase … model explicitly distinguishes between demand and supply effects of central bank asset purchases. Both are shown to lead to …
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We analyze the implications of multiple applications by job seekers for the microfoundations of the matching function. We emphasize a coordination failure caused by multiple applications, namely, that firms can waste resources processing applicants who are ultimately hired elsewhere.
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Since the last recession, it is usually argued that older workers are less affected by the economic downturn because their unemployment rate rose less than the one of prime-age workers. This view is a myth: older workers are more sensitive to the business cycle. We document volatilities of...
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