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This paper investigates the effect of financial shocks using a general equilibrium model that links the firm's flows of financing with labor market variables. The results show that financial shocks… Click to show full abstract
This paper investigates the effect of financial shocks using a general equilibrium model that links the firm's flows of financing with labor market variables. The results show that financial shocks have sizeable effects on debt, dividend payout, and wages. Shocks to the job destruction rate are important in explaining fluctuations in unemployment. The analysis also investigates the underlying driving forces of some key comovements in the data and finds shocks to the job destructions rate important.
Keywords:
job destruction;
labor market;
shocks job;
financial shocks
Journal Title: Macroeconomic Dynamics
Year Published: 2017
Link to full text (if available)
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Journal Title: Macroeconomic Dynamics
Year Published: 2017
Link to full text (if available)
Share on Social Media: Sign Up to like & get
recommendations!