What Does the Beveridge Curve Tell Us about the Likelihood of Soft Landings?

Andrew Figura and Christopher Waller
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Andrew Figura: https://www.federalreserve.gov/econres/andrew-figura.htm

No 2024-073, Finance and Economics Discussion Series from Board of Governors of the Federal Reserve System (U.S.)

Abstract: Any assessment of the likelihood and characteristics of a soft landing in the labor market should take into account the current state of the labor market and the likely dynamics in the labor market going forward. Modern labor market models centered around the Beveridge curve are a useful tool in this assessment. We use a simple model of the Beveridge curve to investigate what conditions are necessary for a soft landing in the labor market to occur and what the likelihood of these conditions was during the height of the pandemic-period inflation. We find that a soft landing was a plausible outcome at that time. Since then, the evolution of the labor market has borne out that prediction.

Keywords: Labor market; Unemployment; Soft landing; Beveridge curve (search for similar items in EconPapers)
JEL-codes: E24 J63 J64 (search for similar items in EconPapers)
Pages: 39 p.
Date: 2024-09-20
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https://www.federalreserve.gov/econres/feds/files/2024073pap.pdf (application/pdf)

Related works:
Working Paper: What does the Beveridge curve tell us about the likelihood of a soft landing? (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgfe:2024-73

DOI: 10.17016/FEDS.2024.073

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