Business Cycle Asymmetries and the Labor Market

Britta Kohlbrecher and Christian Merkl

No 5803, CESifo Working Paper Series from CESifo

Abstract: This paper shows that the matching function and the Beveridge curve in the United States exhibit strong nonlinearities over the business cycle. These patterns can be replicated by enhancing a search and matching model with idiosyncratic productivity shocks for new contacts. Large negative aggregate shocks move the hiring cutoff point into a part of the idiosyncratic density function with higher density and thereby generate large, asymmetric job-finding rate and unemployment reactions. Our proposed mechanism is of high relevance as it leads to time varying effects of certain policy interventions.

Keywords: business cycle asymmetries; matching function; Beverdige curve; job-finding rate; unemployment; effectiveness of policy (search for similar items in EconPapers)
JEL-codes: E24 E32 J63 J64 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (21)

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Related works:
Journal Article: Business cycle asymmetries and the labor market (2022)
Working Paper: Business Cycle Asymmetries and the Labor Market (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_5803

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