Suchergebnisse

1. The Received Econometric Formulation of 2-Market Rationing Models -- 2. Statement of the Problem -- 3. Contents -- I : Theoretical Foundations -- 1. The Structure of Quantity Rationing Models -- 2. Effective Demand Theory -- II : Econometric Formulation of a 2-Market Macroeconomic Model -- 1. First Generation Models -- 2. A Disequilibrium Rationing Model -- 3. Estimation Methods -- Appendix 1 : Proof of Proposition 2.2 -- Appendix 2 : Proof of Proposition 2.3 -- Appendix 3 : Proof of Lemma 2.5 -- III : A Macroeconomic Rationing Model of the Belgian Economy -- 1. A Modified Cobb-Douglas Model -- 2. Labor Hoarding -- 3. Demand for Goods and Labor Supply -- 4. Solvability of the Model -- 5. The Stochastic Model and the Estimation Procedure -- 6. Empirical Results : the Output-Employment Trade-Off -- 7. Estimation of the employment equation -- Appendix 1 : Solvability of a QRM with Labor Hoarding -- Appendix 2 : Data Definitions and Sources -- Conclusion -- References.

ABSTRACTThe contrast between the evolution over the last decades of the European Union (EU) and the US unemployment rates, especially for the low‐skilled, is well known. A consensus view is that these different outcomes can be explained by the interactions between common shocks and specific institutional setups. In this paper, we emphasize the interactions between technological changes and wages rigidities. We construct a fully calibrated general equilibrium model with two types of jobs and two types of workers, and with search unemployment. Our simulations show that with wage rigidities, technological changes suffice to generate a continuous rise in the low‐skilled unemployment rate and an almost unchanged high‐skilled unemployment rate. Without wage rigidities, the unemployment rates remain unchanged but the wage dispersion widens.

This paper is a follow-up to the recommendations made by Jacques Drèze, Edmond Malinvaud and colleagues in 1993 (Drèze, Malinvaud et al., 1994). The key arguments that are of interest for discussion here are paraphrased below: 'For almost 20 years now, West European unemployment has been a major social problem and the sign of a significant underutilisation of resources at a time of substantial unfilled needs. The crux of the matter is a situation of inadequate aggregate demand, at a time when there does not seem to exist any leeway for fiscal expansion. The way out of this dilemma has been correctly identified by the European Commission, namely to find ways of stimulating investment without falling back too much on national budgets for funding. The emphasis on social and public investment is natural at a time when unused capacities limit the immediate prospects for business investment (which, moreover, would be labour saving).

We consider a model with frictional unemployment and staggered wage bargaining where hours worked are negotiated every period. The workers' bargaining power in the hours negotiation affects both unemployment volatility and inflation persistence. The closer to zero this parameter, (i) the more firms adjust on the intensive margin, reducing employment volatility, (ii) the lower the effective workers' bargaining power for wages and (iii) the more important the hourly wage in the marginal cost determination. This set-up produces realistic labor market statistics together with inflation persistence. Distinguishing the probability to bargain the wage of the existing and the new jobs, we show that the intensive margin helps reduce the new entrants wage rigidity required to match observed unemployment volatility.