Labor Markets and Monetary Policy: A New Keynesian Model with Unemployment

By Olivier Blanchard and Jordi Galí

American Economic Journal: Macroeconomics, April 2010

We construct a utility-based model of fluctuations with nominal rigidities and unemployment. We first show that under a standard utility specification, productivity shocks have no effect on unemployment in the constrained efficient allocation. That pro...

Why Hasn't Democracy Slowed Rising Inequality?

[Symposium: The Top 1 Percent]

By Adam Bonica, Nolan McCarty, Keith T. Poole, and Howard Rosenthal

Journal of Economic Perspectives, Summer 2013

During the past two generations, democratic forms have coexisted with massive increases in economic inequality in the United States and many other advanced democracies. Moreover, these new inequalities have primarily benefited the top 1 percent and even...

Time Use, Emotional Well-Being, and Unemployment: Evidence from Longitudinal Data

By Alan B. Krueger and Andreas I. Mueller

American Economic Review, May 2012

This paper provides new evidence on the time use and emotional well-being of unemployed individuals in the weeks before and after starting a new job. The major findings are: (1) time spent on home production drops sharply at the time of re-employment, eve...

Exchange Rates and Employment Instability: Evidence from Matched CPS Data

By Linda Goldberg, Joseph Tracy, and Stephanie Aaronson

American Economic Review, May 1999

Changes in Unemployment and Wage Inequality: An Alternative Theory and Some Evidence

By Daron Acemoglu

American Economic Review, December 1999

I present a model where firms decide what types of jobs to create and then search for suitable workers. When there are few skilled workers and the skilled-unskilled productivity gap is small, firms create a single type of job and recruit all workers. An i...

Valuing Alternative Work Arrangements

By Alexandre Mas and Amanda Pallais

American Economic Review, December 2017

We employ a discrete choice experiment in the employment process for a national call center to estimate the willingness to pay distribution for alternative work arrangements relative to traditional office positions. Most workers are not willing to pay for...

Factoryless Goods Producing Firms

By Andrew B. Bernard and Teresa C. Fort

American Economic Review, May 2015

This paper documents the existence and characteristics of US firms that do not manufacture themselves, but nonetheless are heavily involved in the production of goods. These factoryless goods producing firms (FGPFs) are formally in the wholesale sector bu...

Credit Risk and Disaster Risk

By François Gourio

American Economic Journal: Macroeconomics, July 2013

Credit spreads are large, volatile, and countercyclical, and recent empirical work suggests that risk premia, not expected credit losses, are responsible for these features. Building on the idea that corporate debt, while fairly safe in ordinary recess...

The Long-Term Effects of UI Extensions on Employment

By Johannes F. Schmieder, Till von Wachter, and Stefan Bender

American Economic Review, May 2012

The majority of papers analyzing the employment effects of unemployment insurance (UI) benefit durations focus on the duration of the first unemployment spell. In this paper, we make two contributions. First, we use a regression discontinuity design to an...

Marginal Jobs, Heterogeneous Firms, and Unemployment Flows

By Michael W. L. Elsby and Ryan Michaels

American Economic Journal: Macroeconomics, January 2013

This paper introduces a notion of firm size into a search and matching model with endogenous job destruction. The outcome is a rich, yet analytically tractable framework that can be used to analyze a broad set of features of both the cross-section and ...

Structural Transformation, the Mismeasurement of Productivity Growth, and the Cost Disease of Services

By Alwyn Young

American Economic Review, November 2014

If workers self-select into industries based upon their relative productivity in different tasks, and comparative advantage is aligned with absolute advantage, then the average efficacy of a sector's workforce will be negatively correlated with its emp...

The Ins and Outs of Cyclical Unemployment

By Michael W. L. Elsby, Ryan Michaels, and Gary Solon

American Economic Journal: Macroeconomics, January 2009

A dominant trend in recent modeling of labor market fluctuations is to treat unemployment inflows as acyclical. This trend has been encouraged by recent influential papers that stress the role of longer unemployment spells, rather than more unemploymen...

The Role of Unemployment in the Rise in Alternative Work Arrangements

By Lawrence F. Katz and Alan B. Krueger

American Economic Review, May 2017

The share of U.S. workers in alternative work arrangements has increased substantially in recent decades. Micro longitudinal analyses show that unemployed workers are much more likely to transition into alternative work arrangements than other workers. Ma...

Racial Differences in Transportation Access to Employment in Chicago and Los Angeles, 1980 and 1990

By Chanjin Chung, Samuel L. Myers, and Lisa Saunders

American Economic Review, May 2001

The EITC, Tax Refunds, and Unemployment Spells

By Sara LaLumia

American Economic Journal: Economic Policy, May 2013

The earned income tax credit generates large average tax refunds for low-income parents, and these refunds are distributed in a narrow time frame. I rely on this plausibly exogenous source of variation in liquidity to investigate the effect of cash on ...

The Long-Term Direct and External Effects of Jewish Expulsions in Nazi Germany

By Mevlude Akbulut-Yuksel and Mutlu Yuksel

American Economic Journal: Economic Policy, August 2015

This paper examines the long-term direct and spillover effects of large-scale human capital loss caused by the persecution of Jewish professionals in Nazi Germany. Using region-by-cohort variation in the percentage of the Jewish population as a quasi-expe...

Worker Selection, Hiring, and Vacancies

By Ismail Baydur

American Economic Journal: Macroeconomics, January 2017

This paper incorporates worker selection into a random matching model with multi-worker firms. Unlike the standard Diamond-Mortensen-Pissarides (DMP) model, the extended model is compatible with cross-sectional behavior of vacancy yields, which rise with ...

Why Does Trend Growth Affect Equilibrium Employment? A New Explanation of an Old Puzzle

By Michael W. L. Elsby and Matthew D. Shapiro

American Economic Review, June 2012

That the employment rate appears to respond to changes in trend growth is an enduring macroeconomic puzzle. This paper shows that, in the presence of a return to experience, a slowdown in productivity growth raises reservation wages, thereby lowering aggr...

Optimal Taxation and Social Insurance with Endogenous Private Insurance

By Raj Chetty and Emmanuel Saez

American Economic Journal: Economic Policy, May 2010

We characterize welfare gains from government intervention when the private sector provides partial insurance. We analyze models in which adverse selection, pre-existing information, or imperfect optimization create a role for government intervention. We ...

Declining Business Dynamism: What We Know and the Way Forward

By Ryan A. Decker, John Haltiwanger, Ron S. Jarmin, and Javier Miranda

American Economic Review, May 2016

A growing body of evidence indicates that the U.S. economy has become less dynamic in recent years. This trend is evident in declining rates of gross job and worker flows as well as declining rates of entrepreneurship and young firm activity, and the tren...