Housing and the labor market

Time to move and aggregate unemployment

Peter Rupert, Etienne Wasmer

    Research output: Contribution to journalArticle

    Abstract

    Conventional macro-search models (Mortensen and Pissarides) with unemployment benefits and taxes have been able to account for the variation in unemployment rates across countries but do not account for the role geographic mobility or commuting time might play. We build a model in which both unemployment and mobility rates are endogenous. Our findings indicate that an increase in unemployment benefits and in taxes does not generate a strong decline in mobility but does increase unemployment as in the standard model. We find that with higher commuting costs the effect of housing frictions plays a large role and can generate a substantial decline in mobility.

    Original languageEnglish (US)
    Pages (from-to)24-36
    Number of pages13
    JournalJournal of Monetary Economics
    Volume59
    Issue number1
    DOIs
    StatePublished - Jan 1 2012

    Fingerprint

    Labour market
    Unemployment
    Unemployment benefits
    Tax
    Unemployment rate
    Friction
    Geographic mobility
    Commuting costs
    Commuting

    ASJC Scopus subject areas

    • Finance
    • Economics and Econometrics

    Cite this

    Housing and the labor market : Time to move and aggregate unemployment. / Rupert, Peter; Wasmer, Etienne.

    In: Journal of Monetary Economics, Vol. 59, No. 1, 01.01.2012, p. 24-36.

    Research output: Contribution to journalArticle

    Rupert, Peter ; Wasmer, Etienne. / Housing and the labor market : Time to move and aggregate unemployment. In: Journal of Monetary Economics. 2012 ; Vol. 59, No. 1. pp. 24-36.
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