Projects per year
Abstract
Labor market frictions distort the path of aggregate employment by impeding the flow of labor across firms. For a canonical class of frictions, we show how observable measures of such flows can be used to assess the effect of frictions on aggregate employment dynamics. Application of this approach to establishment microdata for the United States reveals that the empirical flow of labor across firms deviates markedly from the predictions of canonical labor market frictions. Firm-size flows react sluggishly to aggregate shocks in the data, but are predicted to respond aggressively in theory. The paper therefore concludes that the propagation mechanism embodied in standard models of labor market frictions fails to account for the sources of observed employment dynamics.
Original language | English |
---|---|
Pages | 1-50 |
Number of pages | 50 |
Publication status | Published - 24 Dec 2016 |
Keywords / Materials (for Non-textual outputs)
- labor market frictions
- firm dynamics
- adjustment costs
Fingerprint
Dive into the research topics of 'The aggregate effects of Labor Market Frictions'. Together they form a unique fingerprint.Projects
- 1 Finished
-
MacCaLM: Labour and Credit Market Foundations of the Macroeconomy
Moore, J. (Principal Investigator), Belot, M. (Co-investigator), Elsby, M. (Co-investigator), Guell, M. (Co-investigator), Kircher, P. (Co-investigator), Rodriguez Mora, S. (Co-investigator), Snell, A. (Co-investigator), Thomas, J. (Co-investigator), Visschers, L. (Co-investigator), Worrall, T. (Co-investigator) & Zymek, R. (Other)
1/06/15 → 31/05/22
Project: Research
Research output
- 1 Article
-
The aggregate effects of labor market frictions
Elsby, M., Michaels, R. & Ratner, D., Jul 2019, In: Quantitative Economics. 10, 3, p. 803-852Research output: Contribution to journal › Article › peer-review
Open AccessFile
-
39th Annual NBER Summer Institute
Elsby, M. (Participant)
11 Jul 2016 → 29 Jul 2016Activity: Participating in or organising an event types › Participation in workshop, seminar, course
-
Seminar on "The Aggregate Effects of Labor Market Frictions" at St Louis Federal Reserve Bank
Elsby, M. (Speaker)
May 2016Activity: Academic talk or presentation types › Invited talk