---- Acknowledgements ----
This research is supported by NSF grant SES-1024739. First version: June 2009. We are grateful to audiences at Booth, UBC, BU, UCSD, EIEF, FRB Boston, Federal Reserve Board, HEC Montreal, IIES, Maryland, OSU, Penn, UQAM, Rochester, Wharton, Wisconsin, Yale, AEA, NBER EFG, Price Dynamics
and Macro Perspectives meetings, Penn Search and Matching Workshop, SED, CMSG, BC/BU Macro Workshop, Nordic Macro Workshop, as well as Fernando Alvarez, Almut Balleer, John Cochrane, Simon Gilchrist, Veronica Guerrieri, John Haltiwanger, Dirk Krueger, Per Krusell, John Leahy, Stijn Van Nieuwerburgh, Claudia Olivetti, Valerie Ramey, Fabio Schiantarelli, and Randy Wright for comments. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.