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Business Cycle Asymmetries and the Labor Market

Britta Kohlbrecher () and Christian Merkl

No 9816, IZA Discussion Papers from Institute of Labor Economics (IZA)

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: unemployment; job-finding rate; Beverdige curve; matching function; business cycle asymmetries; effectiveness of policy (search for similar items in EconPapers)
JEL-codes: E24 E32 J63 J64 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2016-03
New Economics Papers: this item is included in nep-dge, nep-lab and nep-mac
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Citations: View citations in EconPapers (21) Track citations by RSS feed

Published - published in: Journal of Macroeconomics, 2022, 73, 103458

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https://docs.iza.org/dp9816.pdf (application/pdf)

Related works:
Journal Article: Business cycle asymmetries and the labor market (2022) Downloads
Working Paper: Business cycle asymmetries and the labor market (2022) Downloads
Working Paper: Business Cycle Asymmetries and the Labor Market (2016) Downloads
Working Paper: Business cycle asymmetries and the labor market (2016) Downloads
Working Paper: Business Cycle Asymmetries and the Labor Market (2016) Downloads
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