Mini course day 1
Richard Rogerson gives a mini course on macro labor at SSE. The materials covered are different from my expectation but I really like his presentation. Today is an overview about the stylized facts of unemployment and working hours in OECD countries. Basically he lets data talk. As he stressed, thinking quatatitively is a key feature of modern macroeconometrists. A theory should not only account for why unemployment rate increases or decreases, but also for why it increases 3 points not .3 points. Another point I took from his talk is how to think a bit deeper: taking into account time-series. This reminds me of 'comparative advantage' argument of Lin Yifu. If comparative advantage accounts for the economic miracle of China after 1980s, we should also see this advantage before 1980s...
I guess professor Rogerson is not a fan of thinking differences in labor participation in terms of gender differences. It seems labor participation is gender-neutral from time-series data.
Showing posts with label labor. Show all posts
Showing posts with label labor. Show all posts
Monday, March 23, 2009
Sunday, February 15, 2009
Read Chapter 2 in Pissarides (2000).
Summary of Chapter 1:
1. The model demonstrates how both unemployment and vacancies can exist concurrently in labor market equilibrium. The reason is that searching frictions.
2. The frictions are formed by matching function.
3. In steady state, job creation rate is equal to job destruction rate.
4. Out of steady state, changes in the productivity (or other parameters) have an immediate effect on the wage because wages can be renegotiated any time. Firms are able to adjust their vacancies immediately, hence v and tightness variable jump. The unemployment rate u is pre-determined as it is tied to the matching function. Hence vacancies have the tendency to overshoot.
Related papers:
New developments in models of search in the labor market.
Job reallocation, employment fluctuations and unemployment
Summary of Chapter 1:
1. The model demonstrates how both unemployment and vacancies can exist concurrently in labor market equilibrium. The reason is that searching frictions.
2. The frictions are formed by matching function.
3. In steady state, job creation rate is equal to job destruction rate.
4. Out of steady state, changes in the productivity (or other parameters) have an immediate effect on the wage because wages can be renegotiated any time. Firms are able to adjust their vacancies immediately, hence v and tightness variable jump. The unemployment rate u is pre-determined as it is tied to the matching function. Hence vacancies have the tendency to overshoot.
Related papers:
New developments in models of search in the labor market.
Job reallocation, employment fluctuations and unemployment
Tuesday, February 3, 2009
Just noticed a well-written book: Pissarides, Equilibrium Unemployment Theory
Tomas' paper on strategic ambiguity was published on JPE. I like his style. Hope I can talk to him again when I am clearer about my idea of cheap talk.
Tomas' paper on strategic ambiguity was published on JPE. I like his style. Hope I can talk to him again when I am clearer about my idea of cheap talk.
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