Land Collateral and Labor Market Dynamics in France
Leo Kaas,
Patrick Pintus and
Simon Ray
No 4978, CESifo Working Paper Series from CESifo
Abstract:
The value of land in the balance sheet of French firms correlates positively with their hiring and investment flows. To explore the relationship between these variables, we develop a macroeconomic model with firms that are subject to both credit and labor market frictions. The value of collateral is driven by the forward-looking dynamics of the land price, which reacts endogenously to fundamental and non-fundamental (sunspot) shocks. We calibrate the model to French data and find that land price shocks give rise to significant amplification and hump-shaped responses of investment, vacancies and unemployment that are in line with the data.
Keywords: financial shocks; labor market frictions (search for similar items in EconPapers)
JEL-codes: E24 E32 E44 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)
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Related works:
Journal Article: Land collateral and labor market dynamics in France (2016) 
Working Paper: Land collateral and labor market dynamics in France (2016)
Working Paper: Land Collateral and Labor Market Dynamics in France (2014) 
Working Paper: Land Collateral and Labor Market Dynamics in France (2014) 
Working Paper: Land Collateral and Labor Market Dynamics in France (2014) 
Working Paper: Land Collateral and Labor Market Dynamics in France (2014) 
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_4978
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