Unemployment and Endogenous Reallocation over the Business Cycle

Carlos Carrillo-Tudela and Ludo Visschers

No 302, Edinburgh School of Economics Discussion Paper Series from Edinburgh School of Economics, University of Edinburgh

Abstract: This paper studies the extent to which the cyclicality of occupational mobility shapes that of aggregate unemployment and its duration distribution. Using the SIPP, we document the relation between workers’ occupational mobility and unemployment duration over the long run and business cycle. To interpret this evidence, we develop a multi-sector business cycle model with heterogenous agents. The model is quantitatively consistent with several important features of the US labor market: procyclical gross and countercyclical net occupational mobility, the large volatility of unemployment and the cyclical properties of the unemployment duration distribution, among others. Our analysis shows that occupational mobility due to workers’ changing career prospects interacts with aggregate conditions to drive fluctuations of aggregate unemployment and its duration distribution.

Keywords: Unemployment; Business Cycle; Rest; Search; Occupational Mobility (search for similar items in EconPapers)
JEL-codes: E24 E30 J62 J63 J64 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2021-10
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http://www.econ.ed.ac.uk/papers/id302_esedps.pdf (application/pdf)

Related works:
Journal Article: Unemployment and Endogenous Reallocation Over the Business Cycle (2023)
Working Paper: Unemployment and Endogenous Reallocation over the Business Cycle (2023)
Working Paper: Unemployment and Endogenous Reallocation over the Business Cycle (2020)
Working Paper: Unemployment and Endogenous Reallocation over the Business Cycle (2020)
Working Paper: Unemployment and Endogenous Reallocation over the Business Cycle (2020)
Working Paper: Unemployment and endogenous reallocation over the business cycle (2014)
Working Paper: Unemployment and Endogenous Reallocation over the Business Cycle (2014)
Working Paper: Unemployment and Endogenous Reallocation over the Business Cycle (2014)
Working Paper: Unemployment and Endogenous Reallocation over the Business Cycle (2013)
Working Paper: Unemployment and endogenous reallocation over the business cycle (2013)
Working Paper: Unemployment and endogenous reallocation over the business cycle (2013)
Working Paper: Unemployment and Endogenous Reallocation over the Business Cycle (2013)
Working Paper: Unemployment and Endogenous Reallocation over the Business Cycle (2012)
Working Paper: Unemployment and Endogenous Reallocation over the Business Cycle (2012)
Working Paper: Unemployment and Endogenous Reallocation over the Business Cycle (2011)
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