Debt constraints and employment Patrick J. Kehoe, Virgiliu Midrigan, Elena Pastorino
By: Kehoe, Patrick J
.
Contributor(s): Midrigan, Virgiliu | Pastorino, Elena.
Material type: 
ArticlePublisher: 2019Subject(s): RECESIONES ECONOMICAS | CRISIS FINANCIERA | SOBREENDEUDAMIENTO DE PARTICULARES | CONSUMO | REDUCCION | EMPLEO | ESTADOS UNIDOS | MODELOS ECONOMETRICOSOnline resources: Click here to access online
In:
Journal of Political Economy v. 127, n. 4, August 2019, p. 1926-1991Summary: During the Great Recession, US regions that experienced large declines in household debt also experienced large drops in consumption, employment, and wages. We develop a search and matching model in which tighter debt constraints raise the cost of investing in new job vacancies and so reduce job-finding rates and employment. On-the-job human capital accumulation is critical to generating sizable drops in employment: it
increases the duration of the benefit flows from posting vacancies, thereby amplifying the employment drop from a credit tightening 10-fold relative to the standard model. Our model reproduces the salient cross-regional features of the US Great Recession.
| Item type | Current location | Home library | Call number | URL | Status | Date due | Barcode |
|---|---|---|---|---|---|---|---|
| Artículos | IEF | IEF | OP 229/2019/4-1 (Browse shelf) | https://www.journals.uchicago.edu/doi/pdfplus/10.1086/701608 | Available | OP 229/2019/4-1 |
Disponible también en formato electrónico en la Biblioteca del IEF.
Resumen.
Bibliografía.
During the Great Recession, US regions that experienced large declines in household debt also experienced large drops in consumption, employment, and wages. We develop a search and matching model in which tighter debt constraints raise the cost of investing in new job vacancies and so reduce job-finding rates and employment. On-the-job human capital accumulation is critical to generating sizable drops in employment: it
increases the duration of the benefit flows from posting vacancies, thereby amplifying the employment drop from a credit tightening 10-fold relative to the standard model. Our model reproduces the salient cross-regional features of the US Great Recession.
Click on an image to view it in the image viewer
There are no comments for this item.