Search theory routinely assumes that decisions about acceptance/rejection of job offers (hence, about labor market movements between jobs or across employment states) are made by individuals acting in isolation. In reality, the vast majority of workers are somewhat tied to their partners into...

(they are crowded out). Thus the subsidy strongly acts on the composition of those in education. We find that subsidies made conditional on financial resources are generally preferable to those conditional on ability and large equilibrium effects can be induced by relatively small changes in...

We develop a framework where mismatch between vacancies and job seekers across sectors translates into higher unemployment by lowering the aggregate job-finding rate. We use this framework to measure the contribution of mismatch to the recent rise in U.S. unemployment by exploiting two sources...

By extrapolating Gordon's (1990) measures of the quality-bias in the official price indexes, we construct quality-adjusted price indexes for 24 types of equipment and software (E&S) from 1947 to 2000 and use them to measure technical change at the aggregate and at the industry level....

In this chapter we inspect economic mechanisms through which technological progress shapes the degree of inequality among workers in the labor market. A key focus is on the rise of U.S. wage inequality over the past 30 years. However, we also pay attention to how Europe did not experience...

A wide body of empirical evidence finds that approximately 25 percent of fiscal stimulus payments (e.g., tax rebates) are spent on nondurable household consumption in the quarter that they are received. To interpret this fact, we develop a structural economic model where households can hold two...

The job-search problem of couples differs in significant ways from that of singles. We characterize the reservation wage strategies of a couple that perfectly pools income to understand the ramifications of joint search for individual labor market outcomes. Two cases are analyzed. First, when...

This paper provides an introduction to the special issue of the Review of Economic Dynamics on "Cross Sectional Facts for Macroeconomists''. The issue documents, for nine countries, the level and the evolution, over time and over the life cycle, of several dimensions of economic inequality,...

This report moves beyond the conventional scope of economics to examine three entrenched structural factors -demography, geography and institutions- that are closely connected to economic and social development. Historical in nature and slow to evolve, these variables are not always in the...