driving this result are pro-cyclical increases in the probability of skill loss during unemployment: these provide incentives …. Compositional changes in the unemployment pool, on the other hand, play a negligible role for empirically plausible rates of skill … depreciation, which imply a relatively slow process compared to the duration of unemployment spells …

bargaining cannot generate the observed volatility in unemployment and vacancy in response to reasonable labor productivity … unemployment and vacancy without resorting to an alternative wage setting mechanism. The monetary authority follows an interest …

unemployment rate. In the United States, the unemployment rate raises quickly and abruptly at the onset of contractions and … declines slowly and gradually during expansions. This pattern produces positive skewness in the distribution of unemployment … responsiveness of job vacancies to positive shocks in periods of high unemployment. I argue that the inability of the model to …

Empirically, unemployment is highly volatile while inflation displays inertia, even though marginal cost is pro … unemployment in the Great Recession. Moreover, inflation inertia is made consistent with pro-cyclical marginal cost since the …

density function with higher density and thereby generate large, asymmetric job-finding rate and unemployment reactions. Our …

This paper develops a sufficient-statistic formula for the unemployment gap-the difference between the actual … unemployment rate and the efficient unemployment rate. While lowering unemployment puts more people into work, it forces firms to … post more vacancies and to devote more resources to recruiting. This unemployment-vacancy tradeoff, governed by the …

volatility of vacancies and unemployment. This channel can be relevant if the lack of insurance is large enough so that the … earnings variance and persistence in the unemployment state that result in a large degree of self-insurance …

-cycle-frequency fluctuations in unemployment and job vacancies, given shocks of a plausible magnitude. We use data on the cost of vacancy creation …