The Cyclical Volatility of Labor Markets under Frictional Financial Markets

• 成果类型: Article
• 署名作者: Petrosky-Nadeau, Nicolas; Wasmer, Etienne
• 署名单位: Carnegie Mellon University; Institut d'Etudes Politiques Paris (Sciences Po)
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MACROECONOMICS
• ISSN/ISSBN: 1945-7707
• DOI: 10.1257/mac.5.1.193
• 发表日期: 2013
• 页码: 193-221
• 关键词: equilibrium unemployment; job destruction; business cycles; matching model; search; fluctuations; VACANCIES; BEHAVIOR

摘要

We provide a dynamic extension of an economy with search on credit and labor markets (Wasmer and Weil 2004). Financial frictions create volatility. They add an additional, almost acyclical, entry cost to procyclical job creation costs, thus increasing the elasticity of labor market tightness to productivity shocks by a factor of five to eight, compared to a matching economy with perfect financial markets. We characterize a dynamic financial multiplier that is increasing in total financial costs and minimized under a credit market Hosios-Pissarides rule. Financial frictions are an element of the solution to the volatility puzzle.