Publication
Jan 2010
Shocks driving the business cycle have different effects on low-skilled and high-skilled workers. This paper studies the effects of temporary and permanent sector-specific shocks in a New Keynesian matching model. The author shows that temporary sector-specific shocks have reallaction and aggregate effects. Permanent shocks explain wedges in real wages and different performances in labor markets. Furthermore, the model is able to replicate an aggregate Beveridge curve.
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English (PDF, 26 pages, 1.0 MB) |
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Author | Dennis Wesselbaum |
Series | Kiel Institute Working Papers |
Issue | 1585 |
Publisher | Kiel Institute for the World Economy |
Copyright | © 2010 Kiel Institute for the World Economy |