Idiosyncratic productivity shocks induce larger adjustments to hiring than aggregate shocks, because general equilibrium effects on search frictions and wages partially offset the latter. When firms cannot disentangle the two shocks, they attribute aggregate disturbances partly to idiosyncratic factors and to that extent, respond more aggressively. This translates into increased aggregate volat...

We provide empirical evidence on the nature of spatial externalities in a matching model for the UK. We use a monthly panel of outflows, unemployment and vacancy stocks data from the registers at Jobcentres in the UK; these are mapped on to travel-to-work areas. We find evidence of significant spill-over effects that are generally in line with the predictions of theory. For example, we find tha...

This paper investigates the change in wages associated with a spell of unemployment. The novelty lies in using monthly data from the Survey of Income and Program Participation (SIPP) to analyze the dynamics of those wage changes across different business cycles. The level of education or the sector of re-employment affects the change in wages following an unemployment spell differently across d...

In Lentz and Mortensen (2005), we formulate and estimate a market equilibrium model of endogenous growth through product innovation in the spirit of Klette and Kortum (2004). In this paper, we provide a quantitative solution to the social planner’s problem in the modeled environment. We find that the optimal growth rate is over three times larger than its value in market equilibrium and that th...

This paper argues that the Phillips curve–wage curve controversy cannot be settled within the conventional testing frameworks and suggests an alternative test, which builds on the model of Blanchard and Katz (1997). Using long macro data for the OECD countries, the evidence gives very strong support for the Phillips curve and indicates that wage behaviour is no different among the OECD countrie...

This paper investigates the differences in the matching process of job seekers and vacancies to be filled between different educational and occupational groups. To investigate this issue, matching functions are estimated across different occupations and educational cohorts, that is, on an even lower level of aggregation than previously investigated in the literature, and along different dimensi...

The New Deal for Young People (NDYP) is one of the main components of the UK government’s Welfare-to-Work strategy aimed at raising employment and reducing benefit dependency. It combines elements of an active labour market programme with a stricter benefit regime. This paper evaluates its impact on the wider economy, emphasising the importance of the programme’s effect on wage pressure, which ...

Did European Labor Markets Become More Competitive in the 1990s? Evidence from Estimated Worker Rents This paper analyses the evolution of quantitative measures of employee rents in Europe during the nineties, using the European Household Panel Survey. One looks at two class of measures: wage differentials between workers along industry and firm size dimensions, and estimated welfare difference...

A gazdasagi valsaghelyzetekben gyakran drasztikusan visszaeső hitelkinalat jelentősen ronthatja a vallalatok hitelhez jutasi lehetősegeit, igy kilabalasi eselyeiket, realgazdasagi teljesitmenyuket is. Mennyiben enyhithetik e problemat tamogatott hitelek? Tanulmanyunkban ezt vizsgaljuk meg koronavirus-jarvany miatt Magyarorszagon bevezetett jegybanki es allami hitelprogramok foglalkoztatasi hata...