We present a theory of involuntary unemployment which explains why the unemployed workers ("outsiders") are unable or …-setting and, as a result, involuntary unemployment may arise. …

others suffer long periods of costly adjustment, typically high and persistent unemployment and temporary output losses. We … unemployment duration spells, relatively large wage penalties when changing jobs and higher likelihood of leaving activity for … and persistent unemployment compared to Estonia during the period of EU enlargement. Traditional labour market …

This paper views movements in unemployment as the result of the interaction between: (a) lags in labour market … decisions; and (b) labour market shocks with temporary and permanent components. Two features of unemployment dynamics are … examined: (i) `unemployment persistence', arising when temporary shocks have persistent effects on unemployment; and (ii …

In this paper we analyse the relationship between unemployment and consumption. We study this relationship with panel … empirical results indicate that an increase in the duration of unemployment spells of male household heads is associated with … Mediterranean, provide a fundamental source of insurance against unemployment in southern Europe. …

inflation and a permanent reduction in the level of unemployment. In short, we derive a microfounded long-run downward …

spirit of Blanchard and Summers (1988), the model can generate multiple equilibria, with a low-quits/high-unemployment … equilibrium coexisting with a high-quits/low-unemployment equilibrium. Under weak conditions, low-unemployment equilibria Pareto … dominate high-unemployment equilibria. Mobility premia improve aggregate welfare but may increase unemployment. …