on unemployment inflow and outflow in urban china wu z and yao s 2006 on unemployment inflow and outflow in urban china regional studies 40 811 822 as the largest transitional economy in the world china s labour market has a number of characteristics distinctively different from that of the developed economies such as the uk or the usa this paper aims to identify the determinants of unemployment inflow and outflow in urban china with empirical data for 29 provinces over 1989 99 it is found that rural urban migration ownership diversification industrial structural change international trade international competitiveness product wages and age structure are key determinants of unemployment flows the results suggest that due to market imperfections unemployment inflow and outflow are two asymmetric processes with respect to the concerned predetermined variables wu z et yao s 2006 sur l afflux et la fuite du chomage dans la chine urbaine regional studies 40 811 822 en tant que l economie en voie de transition la plus grande du monde

employer search and employment subsidies in this paper insights into the literature on employment subsidy evaluation and that on employer search are merged to explore uncharted territory the firm and job characteristics leading to deadweight loss in employment subsidy schemes a model is developed which integrates various arguments found in the existing employer search literature using a survey of dutch firms for 1999 the model predictions are confirmed the richness of the data set enables one to construct some measures of deadweight loss which are new to the existing literature it turns out that firms which experience low screening costs large firms firms that forego substantial production due to unfilled jobs vacancies for full time jobs and firms operating in slack labour market conditions cause significantly more deadweight loss

the federal funds rate and the channels of monetary transmission the authors show that the interest rate on federal funds is extremely informative about future movements of real macroeconomic variables then they argue that the reason for this forecasting success is that the funds rate sensitively records shocks to the supply of bank reserves that is the funds rate is a good indicator of monetary policy actions finally using innovations to the funds rate as a measure of changes in policy the authors present evidence consistent with the view that monetary policy works at least in part through credit i e bank loans as well as through money i e bank deposits copyright 1992 by american economic association

job matching in connected regional and occupational labour markets job mobility equilibrates disparities in local labour markets and influences the job matching efficiency we specify a matching function with regional occupational and combined regional occupation

endogenous inequality in integrated labor markets with two sided search we consider a market with red and green workers where labels are payoff irrelevant workers may acquire skills skilled workers search for vacancies while firms search for workers a unique symmetric equilibrium exists in which color is irrelevant there are also asymmetric equilibria in which firms search only for green workers more green than red workers acquire skills skilled green workers receive higher wages and the unemployment rate is higher among skilled red workers discrimination between ex ante identical individuals arises in equilibrium and yet firms have perfect information about their workers and strictly prefer to hire minority workers

do regions benefit from active labour market policies a macroeconometric evaluation using spatial panel methods dauth w hujer r and wolf k do regions benefit from active labour market policies a macroeconometric evaluation using spatial panel methods regional studies the effect of active labour market policies on all job seekers in a region is assessed using the variation in the participation in these programmes across regions over time the starting point is an augmented regional matching function which is extended by allowing for a heterogeneous search effectiveness parameter for current participants and job seekers who finished a measure recently a spatial dynamic panel data model is estimated by using a quasi ml estimation procedure it is found that job schemes in the non profit sector wage subsidies and advancement of apprenticeships significantly increase the regional number of matches

mismatch between unemployment and vacancies in the dutch labour market we analyse the importance of educational mismatch between vacancies and unemployment in the dutch labour market using unemployment and vacancy data by educational level we estimate a matching function which incorporates the effect of educational mismatch on the aggregate flow of filled vacancies using the estimated parameters we calculate how much of total unemployment can be attributed to educational mismatch the results indicate that educational mismatch is not an important determinant of unemployment in the netherlands moreover it shows a remarkable trend contrary to common belief the relative importance of mismatch appears to have strongly decreased since the end of the 1960s

the identification of monetary policy disturbances explaining the liquidity puzzle abstract this paper examines recent work on the identification of monetary policy disturbances its main finding is that the empirical anomalies found in the literature reflect a failure to properly address the federal reserve s policy of accommodating reserve demand shocks a new method of identifying monetary policy using nonborrowed reserves is proposed using this specification policy has a strong persistent liquidity effect regardless of subsample policy granger causes output even in the presence of interest rates explaining approximately 49 of the variance in output at a two year horizon and the residual explanatory power of interest rates for output is negligible

non uniformity of job matching in a transition economy a nonparametric analysis for the czech republic this study explores the properties and development of the matching technology in the czech republic during the transition to a market economy nonparametric additive modelling allows us to assess flexible functional forms which comprise for instance ces and trans log specifications this enables us to evaluate the matching process locally for each combination of unemployment and vacancies rather than being restricted to global coefficients special interest is devoted to analysis and economic determinants of regional variation in the returns to scale of the matching function non linearities are found in the partial adjustment process of unemployment outflows and a negative coefficient on vacancies in some years moreover increasing returns to scale in job matching are found locally returns to scale are found to be negatively correlated to the share in employment in services and to outmigration positively correlated to the employment share in industry the unemployment rate and various measures of ac

job tenure and cyclical changes in the labor market using data on male heads of households from the michigan panel study of income dynamics this paper finds that although short tenure workers accounted for a disproportionate share of total unemployment during the early seventies cyclical fluctuations in joblessness were concentrated among persons currently holding or recently having held longer lasting employment greater unemployment durations were a more important source of rising joblessness than increased separation probabilities and cyclical changes in both variables were larger for recent leavers of medium or long tenure employment than for persons with similar seniority in their current job

search theoretic models of the labor market a survey we survey the literature on search theoretic models of the labor market we show how this approach addresses many issues including the following why do workers sometimes choose to remain unemployed what determines the lengths of employment and unemployment spells how can there simultaneously exist unemployed workers and unfilled vacancies what determines aggregate unemployment and vacancies how can homogeneous workers earn different wages what are the tradeoffs firms face from different wages how do wages and turnover interact what determines efficient turnover we discuss various modeling choices concerning wage determination and the meeting process including recent models of directed search

labor market adjustment in transition economies with on the job search this paper examines the impact of on the job search by workers in the state sector on the level and duration of unemployment in transition economies we derive the optimal speed of state sector closure when workers engage in on the job search 2000 elsevier science s a all rights reserved

empirical studies of financial innovation lots of talk little action this paper reviews the extant empirical studies of financial innovation adopting broad criteria we could find only somewhat more than two dozen studies and since some financial innovations are examined by more than one study they cover only seventeen phenomena especially striking is the fact that only two studies offer tests of the broad hypotheses concerning the environmental conditions spurring financial innovation e g regulation taxes unstable macroeconomic conditions and ripe technologies that have been advanced in descriptive articles we offer some tentative conjectures as to why empirical studies of financial innovation are comparatively rare among our suggested culprits is an absence of accessible data we urge financial regulators to undertake more surveys of financial innovation and to make the survey data more available to researchers

minimum wage effects on labor market outcomes under search matching and endogenous contact rates building upon a continuous time model of search with nash bargaining in a stationary environment we analyze the effect of changes in minimum wages on labor market outcomes and welfare although minimum wage increases may or may not lead to increases in unemployment in our model they can be welfare improving to labor market participants on both the supply and demand sides of the labor market we discuss identification of the model using current population survey data on accepted wages and unemployment durations and show that by incorporating a limited amount of information from the demand side of the market it is possible to obtain credible and precise estimates of all primitive parameters we show that the optimal minimum wage in 1996 depends critically on whether or not contact rates can be considered to be exogenous and we note that the limited variation in minimum wages makes testing this assumption problematic

scale effects in markets with search estimates of aggregate matching functions may miss important scale effects in frictional labour markets because of the reactions of job seekers to scale we estimate a semi structural model of search and matching on a british sample of unemployed people testing for scale effects on the probability of receiving an offer and on the distribution of wage offers we find them only in wage offers but we also find that reservation wages rise to deliver higher post unemployment wages but not faster matches so aggregate matching functions should be unaffected by scale but wage equations should be showing them

a model of competition between unemployed and employed job searchers an application to the unemployment outflow rate in britain this paper proposes a model to explain the allocation of new jobs to workers the central innovation is the analysis of the competition for jobs between employed and unemployed job searchers it is argued that the endogeneity of the fraction of the employed engaging in search is a crucial determinant of the unemployment outflow rate the model is applied to the unemployment outflow rate in britain the model fits the data well and encompasses its main rival copyright 1993 by royal economic society

the relationship between unemployment and vacancies in australia the paper addresses the existence of an equilibrium unemployment vacancies uv relationship in australia cointegration test results suggest that no bivariate long run uv relationship exists moreover this finding fails to support the basic model of labour job search however a modified beveridge curve is proposed where it is found that a number of trivariate equilibrium relationships exist between unemployment vacancies and one other variable the replacement ratio the proportion of long term unemployed or the real wage the existence of an equilibrium relationship in the multivariate framework is due to the endogenous modelling of the un employment flows which are assumed to be exogenous in the bivariate framework of the beveridge curve

unemployment and market size without strong empirical support labour market matching models typically assume constant returns to scale in matching we construct a tractable equilibrium random matching model with a general matching technology introducing market size effects the job finding rate varies with unemployment stable steady states may occur in regions of increasing or decreasing returns and multiple equilibria are welfare ranked by market size while the standard model relies on high frequency shocks to the steady state to explain the co movement of unemployment and job finding locally decreasing returns in matching generate plausible adjustment dynamics and slower convergence lastly an extension of the hosios condition internalises search externalities

the long run behaviour of the real exchange rate evidence from colonial pennsylvania this paper empirically investigates the time series properties of real exchange rate between great britain and colonial pennsylvania during 1727 1775 results provide ample evidence of mean reversion in the real exchange rate

sectoral shifts unemployment and vacancies an empirical analysis for the netherlands abstract in this paper the correlation between sectoral dispersion of employment growth and unemployment is analyzed empirical results for the netherlands indicate that fluctuations in unemployment are due to aggregate demand factors with no substantial influence of shifts in sectoral demand

is there compelling evidence against increasing returns to matching in the labour market matching models of the labour market have been of particular interest in macroeconomics where the notion of thick market externalities can lead to multiple equilibria this has led to some recent interest in constructing empirical estimates of labor market matching functions this paper argues that existing estimates do not provide compelling evidence against the hypothesis of increasing returns in matching the assumption made in several studies that the relevant pool of job searchers is proportional to the stock of unemployment is a potentially important source of downward bias in returns to scale estimates we show the source of this bias theoretically and illustrate its magnitude by estimating canadian aggregate and regional labour market matching functions over the period 1978 88 this evidence suggests significant increasing returns to labor market matching

marketplaces and matching this paper models equilibrium trading patterns when marketplaces exist and goods are differentiated when first visiting the market a buyer samples a stock of goods if fortunate the buyer matches with and purchases one of these goods and then exits the market if an initial match does not exist the buyer can now only match with the flow of new goods for sale the previous stock has been sampled and rejected in a steady state the current stock of unmatched traders on one side of the market is trying to match with the flow of new traders on the other side it is shown that this market behaviour describes matching patterns between unemployed job seekers and vacancies in uk job centres

sectoral shifts and cyclical unemployment a substantial fraction of cyclical unemployment is better characterized as fluctuations of the frictional or natural rate than as deviations from some relatively stable natural rate shifts of employment demand between sectors of the economy necessitate continuous labor reallocation since it takes time for workers to find new jobs some unemployment is unavoidable this paper presents evidence that most of the unemployment fluctuations of the seventies unlike those in the sixties were induced by unusual structural shifts within the u s economy simple time series models of layoffs and unemployment are constructed that include a measure of structural shifts within the labor market these models are estimated and a derived natural rate series is constructed

growth unemployment and labour market institutions evidence from a cross section of eu regions the responsiveness of unemployment to growth is an issue of ongoing political and academic interest economic growth is supposed to be the key to increase labour demand and reduce unemployment departing from okun s law most research on the unemployment intensity of growth has focused on national disparities and the role of labour market institutions empirical evidence at the regional level is scarce we investigate differences in regional labour market responsiveness and their potential determinants for a cross section of european regions the data set covers the nuts 2 regions in the eu15 for the period 1980 to 2002 following a spatial modelling approach interaction among neighbouring labour markets is taken into account our findings point to substantial differences in labour market effects of output growth among european countries and regions both national labour market institutions and regional characteristics such as structural change explain a significant part of these disparities

financial crises bank risk exposure and government financial policy a macroeconomic model with nancial intermediation is developed in which the intermediaries banks can issue outside equity as well as short term debt this makes bank risk exposure an endogenous choice the goal is to have a model that can not only capture a crisis when banks are highly vulnerable to risk but can also account for why banks adopt such a risky balance sheet in the rst place we use the model to assess quantitatively how perceptions of fundamental risk and of government credit

an estimate of a sectoral model of labor mobility this paper develops a model of sectoral labor mobility and tests its main implications the model nests two distinct hypotheses on the origin of mobility a sectoral shocks and b worker employer mismatch we estimate the relative importance of each hypothesis and find that the bulk of labor mobility is caused by mismatch rather than by sectoral shift we then try to put a value on society s match specific information that is we ask to what extent the availability of the option to change jobs raises gnp we find that the mobility option raises expected earnings by roughly between 8 5 percent and 13 percent of labor earnings which translates to an increase in gnp of between 6 percent and 9 percent

unemployment dynamics in britain we examine the inter related dynamics of the unemployment flows and stock our model allows them to be linked through the standard accounting identity but also through behavioural relationships we find that for the uk the bulk of the correlation between duration and the unemployment stock arises from the dependence of duration on unemployment taking careful account of the inter temporal identity outflow shocks have contributed little to the evolution of unemployment since the late 1960s given that the correlation of duration and unemployment arises from the behavioural relationship we show that unemployment dynamics arise mostly from shocks to the inflow unemployment remains one of europe s more pressing economic and social problems as highlighted in the eu s lisbon declaration of 2000 a dynamic approach to unemployment starts from the recognition that unemployment is a stock and changes through shocks to the outflow and inflow the research and policy focus has generally been on the outflow process or equivalently unemployment duration a glance at figure 1 shows why this might be so it reveals a very strong co movement of the unemployment rate and the proportion of the unemployed out of work for a year or more analysts have used data like this to argue that the source of unemployment fluctuations has been changes in the outflow process 1 possibly as a consequence of this most policies directed at reducing unemployment focus on improving the search effectiveness and employability of the currently unemployed the unemployment flows and stock are related in quite complex ways and in this paper we focus on these inter related dynamics the model we use allows them to be linked in two ways first there is the simple accounting relationship whereby shocks to the flows accumulate in the stock second search and matching models suggest behavioural relationships of the flows depending on unemployment the presence of the nonlinear accounting identity in the model makes the analysis of the joint system problematic so we proceed sequentially investigating first one link and then the other we find that for the uk the bulk of the correlation between duration and the unemployment stock displayed in figure 1 arises from the dependence of the former on the latter we find a strong dependence of the outflow rate on unemployment taking careful account of the inter temporal identity on the other hand outflow shocks have contributed little to the evolution of unem

real exchange rate behavior the recent float from the perspective of the past two centuries using annual data spanning two centuries for dollar sterling and franc sterling real exchange rates we find strong evidence of mean reverting real exchange rate behavior using simple stationary autoregressive models estimated on prefloat data we easily outperform nonstationary real exchange rate models in dynamic forecasting exercises over the recent float such stationary univariate equations explain 60 80 percent of the in sample variation in real exchange rates although the degree of short run persistence may be high the econometric estimates imply a half life of shocks to the real exchange rate of about 6 years for dollar sterling and a little under 3 years for franc sterling

how local are labor markets evidence from a spatial job search model this paper models the optimal search strategies of the unemployed across space to characterize local labor markets our methodology allows for linkages between numerous areas while preserving tractability we estimate that labor markets are quite local as the attractiveness of jobs to applicants sharply decays with distance also workers are discouraged from searching in areas with strong job competition from other jobseekers however as labor markets overlap a local stimulus or transport improvements have modest effects on local outcomes because ripple effects in job applications dilute their impact across a series of overlapping markets

raiding opportunities and unemployment this article studies the impact of raiding opportunities in a labor market in which worker abilities differ recruiting firms can either raid an elsewhere employed worker of known ability by bidding up his wage or go through costly search to find a good worker among the unemployed in equilibrium all types of workers experience unemployment high ability workers involuntarily the raiding opportunities give rise to involuntary unemployment without changing the basic properties of the competitive model and thus suggest new implications of various institutional parameters on unemployment in particular unemployment compensation minimum wages wage taxation and search requirements

costly search and recruiting a labor market model with costly search and recruiting is constructed it incorporates many features found in other models and provides new insights into the effects of externalities and transaction costs the model possesses a continuum of equilibria some of which may be pareto ranked with different rates of unemployment despite the multiplicity of equilibria comparative statics results are obtained copyright 1987 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

explaining the great moderation it is not the shocks this paper shows that the explanation of the decline in the volatility of gdp growth since the mid eighties is not the decline in the volatility of exogenous shocks but rather a change in their propagation mechanism

univariate time series behaviour of the real exchange rate evidence from colonial india this paper empirically examines the long run behaviour of the real exchange rate in colonial india between the british pound and the indian rupee using a battery of unit root tests the unit root tests based on the kpss test the gph fractional integration test and the non linear kss test indicate that the real exchange rate series is stationary and mean reverting which tends to support the validity of the purchasing power parity ppp hypothesis in the long run

the beveridge curve in europe new evidence using national and regional data the beveridge curve depicts the empirical negative relationship between job vacancy rate and unemployment rate and reflects the efficiency of the job matching process movements along a fixed downward sloping beveridge curve are associated with cyclical shocks while shifts of the curve arise from structural factors that alter the matching efficiency between job vacancies and unemployed workers national and regional data on job vacancies and unemployment are combined to estimate the beveridge curves of five european countries and their regions focusing on the period 1975 to 2004 i also analyse whether shifts in european beveridge curves are due to changes in the composition of the unemployed pool labour market rigidities or cyclical and structural shocks the empirical evidence suggests that changes in labour market rigidities long term unemployment as well as cyclical shocks are responsible for outward shifts in european beveridge curves i also find evidence of nonlinearities in the relation betw

the effect of wage restraint on labour market flows the effects are studied of a wage restraint policy on flows in the labour market flows into and out of employment are distinguished and simple models are considered for these flows wage costs in particular are found to affect the flow of employment into unemployment which can be considered as a measure of job destruction but wage costs have no effect on the number of new hires which can be considered as a measure of job creation therefore wage moderation has preserved jobs that would otherwise have been destroyed the inflow of new hires is influenced by investments the generosity of the social benefit system and by structural mismatch apart from wage costs interest costs of firms also play a role in the job destruction process particularly since the beginning of the 1980s

job competition and the wage curve longhi s job competition and the wage curve regional studies the wage curve literature consistently finds a negative relationship between regional unemployment rates and regional wages the most widely accepted theoretical explanations interpret the unemployment rate as a measure of job competition this paper proposes new ways of measuring job competition alternative to the unemployment rate and finds that the negative relationship still holds when job competition is measured following the job search literature while for men the wage impact of the theoretically based measures of job competition is rather similar to the wage impact of the unemployment rate for women the difference is substantial longhi s la competition pour l emploi et la courbe des salaires regional studies la documentation sur la courbe des salaires affirme systematiquement que le taux de chomage regional est en correlation faible avec les salaires regionaux les explications theoriques les plus recues considerent le taux de

deposit interest rate ceilings as credit supply shifters bank level evidence on the effects of regulation q abstract how did deposit interest rate ceilings an important feature of the u s regulatory regime until the mid 1980s affect individual banks lending and the transmission of monetary policy to credit i estimate the effect of deposit rate ceilings inscribed in regulation q on commercial banks credit growth using a historical bank level data set starting in 1959 banks credit growth contracted sharply when legally fixed deposit rate ceilings were binding interaction terms with monetary policy suggest that the policy impact on bank level credit growth was non linear and significantly larger when rate ceilings were in place bank size and capitalization mitigate these effects at the bank level short term interest rates exceeding the legally fixed deposit rate ceilings identify policy induced credit supply shifts that disappeared with deposit rate deregulation and thus weakened the bank lending channel substantially since the early 1980s

labor heterogeneity in an urban labor market abstract we construct a model of agglomeration economies in a labor market with friction and heterogeneity of both workers and firms with friction matches between workers and firms are random we show that with random matches an increase in the number of workers brings improvements in worker firm match quality and agglomeration economies emerge if and only if the technology of search exhibits increasing returns to scale we then discuss how to find out empirically whether this condition is satisfied furthermore we investigate properties of the agglomeration economies here and the relation between the city size and states of a labor market

glass steagall a requiem abstract this paper is a discussion of monetary efficiency monetary safety and the relation of the 1933 glass steagall act to both it contains speculation about whether a modified version of the act could have postponed or prevented the crisis of 2008

job search in thick markets abstract i analyze empirically the effects of urban and industrial agglomeration on both search behavior and the efficiency of matching the analysis is based on a unique panel data set from the italian labor force survey micro data covering 520 randomly drawn local labor market areas 66 of the total over the four quarters of 2002 i compute transition probabilities from non employment to employment by jointly estimating the probability of searching and the probability of finding a job conditional on having searched i then test whether these are affected by market size industrial variety and or industry specialization the main results indicate that market size and industry specialization raise job seekers chances of finding employment conditional on having searched while industrial variety is not significantly different from zero finally the effect of agglomeration on non employed individuals search behavior cannot be significantly distinguished from zero

estimating unemployment inflows outflows and long term unemployment in britain using the cointegration approach a model is estimated of flows into and out of unemployment using the johansen multivariate cointegration approach and uk data for the period 1974q4 to 1993q3 two long run equilibrium relationships are obtained covering the outflow rate and unemployment duration which include variables such as the replacement ratio structural change and output a unique feature of the model is that it allows the inflow rate to determine the outflow rate and vice versa this is argued to be important given the common european stylized fact that inflows and outflows are both countercyclical and strongly correlated thus if firms and workers are heterogeneous hiring and firing is contemporaneous necessitating the type of model estimated here some interesting results include the finding that output is not important in determining the outflow rate and that the speed of adjustment of the outflow rate to changes in its underlying equilibrium is slow in contrast the proportion of long term unemployed is positively re

unemployment labour markets and structural change in eastern europe labour markets in eastern europe michael burda unemployment is a major concern in the transforming economies of central and eastern europe the modern flow approach to labour markets suggests both that unemployment is an important component of the transformation process and that the labour market institutions adopted will influence the rate of unemployment in the long run to date eastern european countries exhibit considerable divergences in several of these institutions especially in unemployment benefit systems collective bargaining structures and active labour market policies an aggregate matching function is successfully estimated for data from czech and slovak employment offices emerging labour markets in the east function not so differently from those in the west the implied dynamics make both big bang and benign neglect unattractive strategies for transformation a mixed bang is more appropriate quantitative evidence about the effects on unemployment of different labour market institutions in oecd countries is used to make long term projections of equilibrium rates of unemployment in central and eastern europe given the labour market institutions now in place there with the possible exception of the czech republic high unemployment is likely to be pervasive and persistent

the aggregate effects of sectoral reallocations abstract can a one time permanent change in the fundamentals behind the sectoral composition of the economy prompt an aggregate downturn can this downturn be non negligible even if one uses us data to determine the relative size of gross vs net job flows and the importance of job creation costs can one consider the military build down of the 1990s as a plausible cause for the 1990 1991 recession do sectoral reallocations generate responses that are qualitatively similar to productivity shocks we use a variant of the mortensen pissarides 1994 review of economic studies 61 397 415 job creation destruction model calibrate it to us labor market data and run experiments that suggest one can answer yes to all these questions

the relation between narrative and money market indicators of monetary policy this paper studies the relation between narrative based indicators of monetary policy and widely used money market indicators of monetary policy three principal findings emerge first changes in monetary policy as measured by the narrative based policy indices are associated with persistent changes in the levels of m2 and the monetary base in contrast changes in the narrative policy indicators lead to transitory changes in short term interest rates nonborrowed reserves and the spread between the six month commercial paper rate and the three month treasury bill rate third these findings are generally robust across different narrative based policy indices

the dynamic implications of search discrimination abstract blacks have both lower employment rates and lower earnings than whites further the earnings gap increases as workers age this paper focuses on explaining differences in black white earnings profiles and how government interventions work in a dynamic environment three contributions are made firstly multiple equilibria may exist solely because of a coordination failure by firms even without taste discrimination blacks may play no role in their poor labor market outcomes secondly search discrimination leads to economic discrimination against the non discriminated group reverse discrimination finally in response to a quota program whites may find it optimal to subsidize black investment

credit crises money and contractions an historical view abstract the relatively infrequent nature of major credit distress events makes an historical approach particularly useful using a combination of historical narrative and econometric techniques we identify major periods of credit distress from 1875 to 2007 examine the extent to which credit distress arises as part of the transmission of monetary policy and document the subsequent effect on output using turning points defined by the harding pagan algorithm we identify and compare the timing duration amplitude and co movement of cycles in money credit and output regressions show that financial distress events exacerbate business cycle downturns both in the 19th and 20th centuries and that a confluence of such events makes recessions even worse

permanent and transitory components in macroeconomic fluctuations fluctuations in real gnp have traditionally been viewed as transitory deviations from a deterministic time trend the purpose of this paper is to review some of the recent developments that have led to a new view of output fluctuations and then to provide some additional evidence using post war quarterly data it is hard to reject the view that real gnp is as persistent as a random walk with drift we also consider the hypothesis that the recent finding of persistence are due to the failure to distinguish the business cycle from other fluctuations in real gnp we use the measured unemployment rate to decompose output fluctuations we find no evidence for the view that business cycle fluctuations are more quickly trend reverting this abstract was borrowed from another version of this item

monetary policy as financial stability regulation this paper develops a model that speaks to the goals and methods of financialstability policies there are three main points first from a normative perspective the model defines the fundamental market failure to be addressed namely that unregulated private money creation can lead to an externality in which intermediaries issue too much short term debt and leave the system excessively vulnerable to costly financial crises second it shows how in a simple economy where commercial banks are the only lenders conventional monetary policy tools such as open market operations can be used to regulate this externality while in more advanced economies it may be helpful to supplement monetary policy with other measures third from a positive perspective the model provides an account of how monetary policy can influence bank lending and real activity even in a world where prices adjust frictionlessly and there are other transactions media besides bank created money that are outside the control of the central bank

physicians services and the division of labor across local markets this paper reports empirical evidence of systematic cross locale variation in the degree of division of labor among physicians a theoretical model based on an individual producer s trade off between increasing returns and falling marginal revenue within each activity motivates the empirical tests at two levels of aggregation specialization is correlated with local demand shifters for medical services at the individual level i find systematic differences in the range of procedures performed within a specialty class general practitioners working fewer hours practicing in more populated counties or practicing in countries with more elderly produce a narrower range of procedures

cross section estimation of the matching function evidence from england and wales this paper analyses how the levels of unemployment and vacancies affect the rate at which unemployed workers find employment the worker firm matching function in particular we test the robustness of previous empirical work by checking whether we obtain the same estimated function using cross section data rather than aggregate time series data we find strong evidence of constant returns to scale similar to previous work we also find larger cities have higher wages this provides indirect support for increasing returns but where those returns are taken in the form of better quality matches

thick market effects and churning in the labor market evidence from u s cities using u s census microdata we show that on average workers change occupation and industry less in more densely populated areas the result is robust to standard demographic controls as well as to including aggregate measures of human capital and sectoral mix analysis of the displaced worker surveys shows that this effect is present in cases of involuntary separation as well on the other hand we actually find the opposite result higher rates of occupational and industrial switching for the subsample of younger workers these results provide evidence in favor of increasing returns to scale matching in labor markets results from a back of the envelope calibration suggest that this mechanism has an important role in raising both wages and returns to experience in denser areas

the impact of young workers on the aggregate labor market an increase in the share of youth in the working age population of one state or region relative to the rest of the united states causes a sharp reduction in that state s relative unemployment rate and a modest increase in its labor force participation rate this is inconsistent with many theories of the labor market but can be easily explained by a model of frictional unemployment with on the job search the theory makes strong predictions regarding the behavior of wages which are shown to be consistent with the data the paper also reconciles its findings with an existing body of apparently contradictory empirical evidence

competition between employed and unemployed job applicants swedish evidence we use the swedish applicant database to investigate empirically whether being unemployed per se reduces the probability of getting contacted by a firm all searchers looking for a new job are invited to submit their personal details to this database over the internet since we have access to exactly the same information as the firms we can minimize the problems associated with unobserved heterogeneity our results show that an unemployed applicant faces a lower contact probability than an otherwise identical employed applicant thus supporting the notion that firms view employment status as a signal of productivity

deposit rate ceilings and monetary transmission in the us abstract establishing the existence and nature of changes in the conduct and transmission of monetary policy is key in understanding the remarkable macroeconomic performance of the us since the mid 1980s this paper presents evidence on a phenomenon of disintermediation occurring during the major recessions in the 1960s and 1970s but absent ever since and shows that disintermediation is closely linked to the existence of deposit rate ceilings under regulation q in a monetary dsge model that incorporates deposit rate ceilings as occasionally binding constraints the regulation alters the behavior of money aggregates and exacerbates the drop in economic activity following a monetary tightening the results of a threshold var lend support to the main theoretical predictions of the model

an empirical index for labor market density we derive a structural index for labor market density based on the ellison glaeser index for industry concentration the labor market density index serves as a proxy for the number of workers that are potentially available for jobs in a particular area the index is based on observed home work location patterns it is particularly useful for testing theories where the scale of the market matters we apply this index to a standard wage equation and find that it explains almost half of the cross region wage variance

empirical matching functions searchers vacancies and un biased elasticities this paper shows that conventional empirical estimates of matching functions are systematically biased because unobservable and endogenous search behaviour such as on the job search by workers or the use of different search channels by firms is neglected i propose an approach for recovering unbiased elasticities under different scenarios of competition for workers and jobs without the need for constructing proxies for unobserved stocks of searchers and vacancies using german administrative data i estimate the biases affecting conventional studies and derive bias corrected estimates of the matching elasticities under different scenarios

filling vacancies an empirical analysis of the cost and benefit of search in the labour market this paper investigates empirically the factors that affect the cost benefit ratio of employers search the empirical analysis is based on a small dutch data set containing individual information on filled vacancies it is found that firms that use advertisements during recruitment are sensitive to labour market conditions their search cost per applicant rises drops in tight slack labour markets because of the diminished ability of advertisements to generate applicants in tight labour markets furthermore it is found that the high search cost incurred by posting identical vacancies is more than compensated for by the benefits from having a larger flow of applicants

rational expectations business cycles in search equilibrium we examine the rational expectations equilibrium paths of the model of search and barter in diamond s aggregate demand management in search equilibrium for some initial positions there are two equilibrium paths converging to different steady states with the high activity path pareto dominating the low activity path with some parameters there is also a continuum of equilibrium paths converging to another steady state moreover there can be cycles that are equilibrium paths even though the environment is stationary

worker flows job flows and unemployment in a matching model abstract standard matching models of unemployment generate far too little volatility in unemployment and vacancies relative to the variation in the shock variables shimer 2005 showed that in us data the vacancy to unemployment ratio is about 26 times more volatile than the standard model predicts he identified the flexibility of wages as the key issue and triggered a heated debate on possible improvements of the core model to accommodate these empirical facts in this paper we first document shimer s facts for the uk and find them to be qualitatively similar to us facts we then develop and calibrate a model based on the mortensen and pissarides approach that increases the volatility of the v u ratio 20 fold compared to the standard framework the key features of our model relate to the job creation decision by firms and the search options of workers we allow these to search whilst employed and firms to re advertise jobs that have been quit from this leads us to use a different job creation process whereby potential vacancies or job ideas arise at a finite rate per period over a range of idiosyncratic productivities calibrating the model to uk data we show that it delivers volatility in unemployment and vacancies much closer to though still not as large as that observed for the uk whilst retaining the standard wage determination process

bottlenecks and the phillips curve a disaggregated keynesian model of inflation output and unemployment benchmark macroeconomic models of output and inflation combine the demand side of the economy with aggregate supply equations based upon some version of the phillips curve in contrast to classical and new classical models such as lucas i972 and sargent 1979 chs i xii and xvi in which prices jump instantaneously to market clearing levels the gradual price adjustment approach represented by tobin 1972 laidler and parkin i975 section 4 barro and grossman 1976 ch 5 sargent 1979 ch ii and ch v i okun i98i and perry i983 take wages and or prices to be predetermined at an instant in time while their rates of change depend on the level of aggregate output in the prototype complete macroeconomic model incorporating this approach output is determined by aggregate demand equations while the augmented phillips curve specifies that prices move in a direction which will tend to return output to its equilibrium value this short run keynesian long run monetarist character is typical of many structural macroeconometric models it is the standard textbook account found for example in dornbusch and fischer i98i and is implicit in much current research there are fundamental questions of consistency in the type of model just described the central difficulty is that with wages and prices predetermined the non market clearing analysis ofbarro and grossman i 976 ch 2 and malinvaud i977 is applicable but in this world the aggregate demand equations are decisive only in the keynesian regime in the other regimes which must arise at high levels of aggregate demand the effective supplies of output or labour or both must be modelled indeed at the aggregate level it is difficult to provide a coherent account of how it is possible to have output above its equilibrium value since this would require labour and output in excess of their notional supplies violating barro and grossman s min condition that quantities be determined by the short side of the market an appealing line for addressing this last difficulty is to disaggregate markets an approach taken by hansen i970 tobin i972 and barro and grossman i976 ch 5 however because each market can be in either excess supply or demand a formal fixed price general equilibrium model appears to be intractable due to the resulting multiplicity of regimes and is not attempted by these authors in this paper these problems are overcome in a disaggregated model in which

the establishment level behavior of vacancies and hiring this paper is the first to study vacancies hires and vacancy yields at the establishment level in the job openings and labor turnover survey a large sample of u s employers to interpret the data we develop a simple model that identifies the flow of new vacancies and the job filling rate for vacant positions the job filling rate moves counter to aggregate employment but rises steeply with employer growth rates in the cross section it falls with employer size rises with worker turnover rates and varies by a factor of four across major industry groups we also develop evidence that the employer level hiring technology exhibits constant returns and that at the employer level and that employers rely heavily on other instruments in addition to vacancies as they vary hires we also develop evidence that effective recruiting intensity per vacancy varies over time accounting for about 41 of movements in aggregate hires in the 2007 to 2009 period our evidence and analysis provide useful inputs for assessing developing and calibrating theoretical models of search matching and hiring in the labor market

regime non stationarity in the us uk real exchange rate abstract using a markov switching extension of the adf regression we find evidence that the us uk real exchange rate is stationary in periods when it is in a low volatility regime and nonstationary when it is in a high volatility regime

the impact of the 1980 depository institutions deregulation and monetary control act on market value and risk evidence from the capital markets the depository institutions deregulation and monetary control act of 1980 brought about major changes in the banking industry this study employs capital market data to examine the act s impact on the relative competitive positions of distinct classes of firms within the industry the evidence supports the hypothesis that federal reserve system banks profited from the regulatory change at the expense of nonmember banks and savings and loans copyright 1988 by ohio state university press

sectoral shifts and unemployment persistence this paper deals with possible explanations of unemployment persistence within a sectoral approach to the austrian labour market first the concept of unemployment persistence is specified in terms of the time series properties of the unemployment rate sectoral job gains and job losses form the labour market flows in this approach the standard matching model is replaced then by a model of the competition between the unemployed and new entrants in the labour market for new jobs as an adding up demand system of the aids type the estimations of different system specifications indicate that the sectoral structure of job gains plays a role in the competition mechanism between unemployed workers and new entrants

labor specialization and the extent of the market this paper presents an analytical model of labor specialization workers make human capital investment decisions on the depth and the breadth of their skill given that firms have diverse job requirements and increasing returns to scale workers invest more for the depth of their human capital and less for the breadth as the size of the labor market increases also the larger the size of the market the more varieties of job requirements are used so that the average match between a worker and a firm improves

sectoral shifts employment specialization and the efficiency of matching an analysis using uk regional data robson m 2006 sectoral shifts employment specialization and the efficiency of matching an analysis using uk regional data regional studies 40 743 754 over the past 30 years the industry composition of unemployment in the uk has been subject to considerable structural change the degree of which has varied significantly across regions this paper uses lilien s index of sectoral shifts to document the incidence of structural change across regions and in addition follows the work of wren and taylor 1999 by computing measures of the degree of specialization in regional employment it then uses these data to examine the effect of sectoral shifts and employment specialization on the efficiency of the process with which unemployed workers are matched to available job vacancies in regional labour markets robson m 2006 l evolution sectorielle la specialisation de l emploi et l adequation du travail une analyse de donnees regionales du royaume uni regional studies 40 743 754 pendant les trente

what are the determinants of hiring the importance of product market demand and search frictions in this article we study the importance of product market demand and search frictions for hiring we use a search matching model with imperfect competition in the product market to derive an equat

an empirical note on employed and unemployed job search abstract the results of the analysis in this paper suggest that competition between employed and unemployed job seekers is introduced by employers who use different recruitment channels for the same vacancy

matching with phantoms searching for partners involves informational persistence that reduces future traders matching probability in this article traders who are no longer available but who left tracks on the market are called phantoms we examine a dynamic matching market in which phantoms are a by product of search activity no coordination frictions are assumed and non phantom traders may lose time trying to match with phantoms the resulting aggregate matching technology features increasing returns to scale in the short run but has constant returns to scale in the long run we embed a generalized version of this matching function in the canonical continuous time equilibrium search unemployment model long run constant returns to scale imply there is a unique steady state whereas short run increasing returns generate excess volatility in the short run and endogenous fluctuations based on self fulfilling prophecies