Information about this author at RePEc
NBER Working Papers and Publications
|January 2009||What Can We Learn About Firm Recruitment from the Job Openings and Labor Turnover Survey?|
in Producer Dynamics: New Evidence from Micro Data, Timothy Dunne, J. Bradford Jensen, and Mark J. Roberts, editors
|October 2005||More on Unemployment and Vacancy Fluctuations|
with Dale T. Mortensen: w11692
Shimer (2005a) argues that the Mortensen-Pissarides equilibrium search model of unemployment explains only about 10% of the response in the job-finding rate to an aggregate productivity shock. Some of the recent papers inspired by his critique are reviewed and commented on here. Specifically, we suggest that the sole problem is neither the procyclicality of the wage nor the failure to account fully for the opportunity cost of employment. Although an amended version of the model, one that accounts for capital costs and counter cyclic involuntary separations, does much better, it still explains only 40% of the observed volatility of the job-finding rate. Finally, allowing for on-the-job search does not improve the amended models implications for the amplification of productivity shocks.
Published: Dale Mortensen & Eva Nagypal, 2007. "More on Unemployment and Vacancy Fluctuations," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 10(3), pages 327-347, July. citation courtesy of