A Real-Business-Cycle model with search-and-matching frictions and efficiency ("fair") wages

Vasilev, Aleksandar (2021) A Real-Business-Cycle model with search-and-matching frictions and efficiency ("fair") wages. Journal of Economics and Econometrics, 64 (2). pp. 1-23. ISSN 2032-9652

Full content URL: https://ideas.repec.org/a/eei/journl/v64y2021i2p1-...

Documents
A Real-Business-Cycle model with search-and-matching frictions and efficiency ("fair") wages
Accepted Manuscript
[img] PDF
RBC_labor_search_and_efficiency_wages_2021(1).pdf - Whole Document
Restricted to Repository staff only

314kB
Item Type:Article
Item Status:Live Archive

Abstract

In this paper we combine two important ingredients - search and matching frictions and "fair wages," and investigate their combined quantitative importance in explaining fluctuations in Bulgarian labor markets. Overall, the calibrated real-business-cycle model for Bulgaria after the introduction of the currency board, when featuring both search-
and-matching frictions, and reciprocity in labor relations, performs better vis-a-vis data, and in addition dominates the model with search frictions only (Vasilev 2016a), and setups with efficiency wages alone (Vasilev 2017a,b). The search and matching mechanism captures the volatility of unemployment, while the efficiency wage mechanism fits better the cyclicality of the wage rate.

Keywords:general equilibrium, reciprocity, gift exchange, e?ciency wages, unem- ployment, Bulgaria
Subjects:L Social studies > L130 Macroeconomics
Divisions:Lincoln International Business School
ID Code:46886
Deposited On:15 Dec 2021 14:00

Repository Staff Only: item control page