Business cycle dynamics

Author(s):  
Christian Müller ◽  
Eva Köberl
2019 ◽  
Vol 109 ◽  
pp. 103781 ◽  
Author(s):  
Christie Smith ◽  
Christoph Thoenissen

2014 ◽  
Vol 41 (5) ◽  
pp. 721-736 ◽  
Author(s):  
Dennis Wesselbaum

Purpose – The purpose of this paper is to compare two elements of lay-off costs in a dynamic model of the labor market and analyze the differences for business cycle dynamics and welfare. Design/methodology/approach – The paper builds a general equilibrium Real Business Cycle model and introduces firing costs and severance payments. Labor market frictions are assumed to follow the famous search and matching approach. Findings – The paper finds that firing costs imply a higher volatility over the cycle and have stronger negative welfare effects. Severance payments have a lower volatility, reduce unemployment, and reduce welfare by a smaller amount. Practical implications – Policy reforms should be aimed to use severance payments and reduce the ring cost component of lay-off costs. Originality/value – Increasing welfare and a more stable business cycle could be supported by using severance payments instead of firing costs.


2008 ◽  
Vol 15 (15) ◽  
pp. 1153-1157
Author(s):  
Valerie Cerra ◽  
Sweta C. Saxena

2010 ◽  
Vol 42 (29) ◽  
pp. 3789-3802 ◽  
Author(s):  
Jörg Döpke ◽  
Sebastian Weber

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