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Slow to Hire, Quick to Fire: Employment Dynamics with Asymmetric Responses to News

Cosmin Ilut, Matthias Kehrig and Martin Schneider ()

Working Papers from U.S. Census Bureau, Center for Economic Studies

Abstract: Concave hiring rules imply that firms respond more to bad shocks than to good shocks. They provide a united explanation for several seemingly unrelated facts about employment growth in macro and micro data. In particular, they generate countercyclical movement in both aggregate conditional “macro” volatility and cross-sectional “micro” volatility as well as negative skewness in the cross section and in the time series at different level of aggregation. Concave establishment level responses of employment growth to TFP shocks estimated from Census data induce significant skewness, movements in volatility and amplification of bad aggregate shocks.

Keywords: business cycles; time varying volatility; asymmetric adjustment; skewness (search for similar items in EconPapers)
JEL-codes: D2 D8 E2 J2 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-lma and nep-mac
Date: 2017-01
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Downloads: (external link)
https://www2.census.gov/ces/wp/2017/CES-WP-17-15.pdf First version, 2017 (application/pdf)

Related works:
Journal Article: Slow to Hire, Quick to Fire: Employment Dynamics with Asymmetric Responses to News (2018) Downloads
Working Paper: Slow to Hire, Quick to Fire: Employment Dynamics with Asymmetric Responses to News (2017) Downloads
Working Paper: Slow to Hire, Quick to Fire: Employment Dynamics with Asymmetric Responses to News (2015) Downloads
Working Paper: Slow to Hire, Quick to Fire: Employment Dynamics with Asymmetric Responses to News (2014) Downloads
Working Paper: Slow to Hire, Quick to Fire: Employment Dynamics with Asymmetric Responses to News (2014) Downloads
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