Labor-market Volatility in a Matching Model with Worker Heterogeneity and Endogenous Separations

@inproceedings{Chassamboulli2013LabormarketVI,
  title={Labor-market Volatility in a Matching Model with Worker Heterogeneity and Endogenous Separations},
  author={Andri Chassamboulli},
  year={2013}
}
This paper shows that introducing worker heterogeneity into a standard search and matching model can help increase the volatility of unemployment without violating the tight negative correlation between vacancies and unemployment, i.e., the Beveridge curve. In the model, periods of high job destruction and unemployment correspond with periods of more severe mismatch between the demands of firms and the qualifications of job seekers. A more severe mismatch translates into fewer successful… CONTINUE READING

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