Life Cycle Equilibrium Unemployment

Arnaud Cheron, Jean-Olivier Hairault and Francois Langot

Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) from HAL

Abstract: This paper extends the job creation--job destruction approach to the labor market to take into account a deterministic finite horizon. As hirings and separations depend on the time over which investment costs can be recouped, the life-cycle setting implies age-differentiated labor-market flows. While search by the unemployed falls with age, the separation rate is rather U-shaped over the life cycle. Worker heterogeneity in the context of undirected search implies an intergenerational externality, which is not eliminated by the Hosios condition. We show that age-specific policies are required to attain the first-best allocation

Date: 2013-10
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Published in Journal of Labor Economics, 2013, 31 (4), pp.843-882. ⟨10.1086/669941⟩

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Related works:
Journal Article: Life-Cycle Equilibrium Unemployment (2013)
Working Paper: Life Cycle Equilibrium Unemployment (2013)
Working Paper: Life Cycle Equilibrium Unemployment (2011)
Working Paper: Life-Cycle Equilibrium Unemployment (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:cesptp:hal-00759471

DOI: 10.1086/669941

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