TY - JOUR
T1 - The determinants of equilibrium unemployment
AU - Yashiv, Eran
PY - 2000/12
Y1 - 2000/12
N2 - The paper takes the search and matching model of the aggregate labor market to the data. It tests the model's empirical validity and employs structural estimation to generate a characterization of the optimal behavior of firms and workers. The model is applied to Israeli data that are uniquely suited for this kind of empirical investigation. The structural estimates are used to quantify the frictions embodied in the model, including the costs of search, the congestion and trading externality effects, and the matching process. A calibration-simulation analysis then studies the effect of several key variables on equilibrium unemployment.
AB - The paper takes the search and matching model of the aggregate labor market to the data. It tests the model's empirical validity and employs structural estimation to generate a characterization of the optimal behavior of firms and workers. The model is applied to Israeli data that are uniquely suited for this kind of empirical investigation. The structural estimates are used to quantify the frictions embodied in the model, including the costs of search, the congestion and trading externality effects, and the matching process. A calibration-simulation analysis then studies the effect of several key variables on equilibrium unemployment.
UR - http://www.scopus.com/inward/record.url?scp=0013203029&partnerID=8YFLogxK
U2 - 10.1257/aer.90.5.1297
DO - 10.1257/aer.90.5.1297
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AN - SCOPUS:0013203029
SN - 0002-8282
VL - 90
SP - 1297
EP - 1322
JO - American Economic Review
JF - American Economic Review
IS - 5
ER -