Titelaufnahme

Titel
Uncertainty shocks and unemployment dynamics / Malak Kandoussi (Université Paris-Saclay and University of Evry), François Langot (Le Mans University, IUF, PSE and IZA) ; IZA Institute of Labor Economics
VerfasserKandoussi, Malak ; Langot, François
KörperschaftForschungsinstitut zur Zukunft der Arbeit
ErschienenBonn, Germany : IZA Institute of Labor Economics, July 2020
Ausgabe
Elektronische Ressource
Umfang1 Online-Ressource (27 Seiten) : Diagramme
SerieDiscussion paper ; no. 13438
URLVolltext
URNurn:nbn:de:hbz:5:2-851821 
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 Das Dokument ist öffentlich zugänglich im Rahmen des deutschen Urheberrechts.
Volltexte
Uncertainty shocks and unemployment dynamics [0.64 mb]
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Zusammenfassung

Recent events suggest that uncertainty changes play a major role in U.S. labor market fluctuations. This study analyzes the impact of uncertainty shocks on unemployment dynamics. Using a vector autoregression approach, we show that uncertainty shocks measured by stock market volatility have a significant impact on the U.S. unemployment rate. We then develop a quantitative version of the Diamond-Mortensen-Pissarides (DMP) model, in which uncertainty shocks hit the economy. Given the significant nonlinearities of the DMP model, we show that the introduction of uncertainty shocks not only allows this textbook model to account for observed characteristics of the U.S. labor market dynamics, with reasonable values for calibrated parameters, but also for the impact of rare episodes such as economic crises.

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