In this note I argue that the desirability of fiscal policy in response to the current crisis depends on whether one views the current crisis as a temporary deviation from a unique equilibrium or as a bad equilibrium out of multiple equilibria. The paper presents a simple Diamond (1982) type of...

The continuing deterioration of the position of low skilled workers in the beginning of the 90's in essentially all industrialized countries is one of the most debated issues in both labor and macro-economics. In this paper a matching model with low and high skilled workers and simple and...