Aggregate Employment Fluctuations with Microeconomic Asymmetries

Jonas Fisher and Jeffrey Campbell

American Economic Review, 2000, vol. 90, issue 5, 1323-1345

Abstract: We provide a simple explanation for the observation from the U.S. manufacturing sector that the job destruction rate fluctuates more than the job creation rate. In our model, proportional plant-level costs of creating and destroying jobs cause shrinking plants to be more sensitive to aggregate shocks than growing plants. We describe circumstances in which this microeconomic asymmetry is preserved in the aggregate and show that it can account for much of the observed asymmetries in gross job flows. This is so even though we abstract from job matching frictions, incomplete contracts, and aggregate congestion effects.

JEL-codes: E24 J23 J68 (search for similar items in EconPapers)
Date: 2000
Note: DOI: 10.1257/aer.90.5.1323
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Citations: View citations in EconPapers (50)

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Related works:
Working Paper: Aggregate employment fluctuations with microeconomic asymmetries (1998)
Working Paper: Aggregate employment fluctuations with microeconomic asymmetries (1996)
Working Paper: Aggregate Employment Fluctuations with Microeconomic Asymmetries (1996)
Working Paper: Aggreagate Employment Fluctuations with Microeconomic Asymmetries (1996)
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