EconPapers    
Economics at your fingertips  
 

Anticipated productivity and the labor market

Ryan Chahrour, Sanjay Chugh and Tristan Potter

Quantitative Economics, 2023, vol. 14, issue 3, 897-934

Abstract: We identify the main shock driving fluctuations in long‐horizon productivity expectations, consistent with theories of TFP news. The identified shock induces strong comovement patterns in output, consumption, investment, employment, and stock prices even though TFP does not change significantly for more than 2 years. A labor search model in which wages are determined by a cash‐flow sharing rule, rather than the present value of match surplus, matches the observed responses to the news shock. The model also matches the empirical patterns of vacancies, labor force participation, hours, and job‐finding rates. The proposed wage rule is consistent with empirical responses of wages to both anticipated and unanticipated productivity changes.

Date: 2023
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://doi.org/10.3982/QE2029

Related works:
Working Paper: Anticipated Productivity and the Labor Market (2020) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wly:quante:v:14:y:2023:i:3:p:897-934

Ordering information: This journal article can be ordered from
https://www.econometricsociety.org/membership

Access Statistics for this article

More articles in Quantitative Economics from Econometric Society Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().

 
Page updated 2025-03-20
Handle: RePEc:wly:quante:v:14:y:2023:i:3:p:897-934