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The Lumpy Job Separation Rate Reconciling Search Models with the Ins and Outs of Unemployment
| Content Provider | Semantic Scholar |
|---|---|
| Author | Barnichon, Régis |
| Copyright Year | 2010 |
| Abstract | This paper presents a search model with an asymmetric and “lumpy”job separation margin, which is consistent with recent micro evidence on establishment behavior: the job separation rate can increase following negative labor demand shocks but is kept constant following positive labor demand shocks. The model is consistent with the cyclical behavior of labor market variables and can account for three stylized facts about unemployment that the Mortensen-Pissarides (1994) model has di¢ culties explaining jointly: (i) the unemployment-vacancy correlation is negative, (ii) the contribution of the job separation rate to unemployment ‡uctuations is small but non-trivial, (iii) movements in the job separation rate are sharp and short-lived while movements in the job …nding rate are persistent. In addition, the model can rationalize two hitherto unexplained …ndings: why unemployment in‡ows were less important in the last two decades, and why the asymmetric behavior of unemployment weakened after 1985. JEL classi…cations: J63, J64, E24, E32 |
| File Format | PDF HTM / HTML |
| Alternate Webpage(s) | http://www.crei.cat/wp-content/uploads/users/working-papers/Lumpyjs.pdf |
| Language | English |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
