The Cyclical Behavior of Equilibrium Unemployment and Vacancies Across OECD Countries

Murat Tasci and Pedro Amaral

No 450, 2013 Meeting Papers from Society for Economic Dynamics

Abstract: We show that the inability of a standardly-calibrated stochastic labor search-and-matching model to account for the observed volatility of unemployment and vacancies extends beyond U.S. data to a set of OECD countries -- the volatility puzzle is ubiquitous. We also argue that using cross-country data is helpful in evaluating the relative merits of the model alternatives that have appeared in the literature. In illustrating this point, we take the solution proposed in Hagedorn and Manovskii (2008) and show that it continues to predict counterfactually low volatility in labor market variables for countries that exhibit sufficiently low persistence in their estimated productivity processes.

Date: 2013
New Economics Papers: this item is included in nep-dge and nep-lab
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Citations: View citations in EconPapers (3)

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Related works:
Journal Article: The cyclical behavior of equilibrium unemployment and vacancies across OECD countries (2016)
Working Paper: The Cyclical Behavior of Equilibrium Unemployment and Vacancies Across OECD Countries (2014)
Working Paper: The cyclical behavior of equilibrium unemployment and vacancies across OECD countries (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:red:sed013:450

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