I kinda wished they had included a model but it seems pretty clear that they're thinking through the lens of something like an RBC model+MP search and matching labor market. I've always liked the approach, it gets rid of the "unemployment=taking a vacation" argument against real business cycles.
Your St. Louis Fed/blogger colleague was one of the first to do it if I recall correctly.
I kinda wished they had included a model but it seems pretty clear that they're thinking through the lens of something like an RBC model+MP search and matching labor market. I've always liked the approach, it gets rid of the "unemployment=taking a vacation" argument against real business cycles.
ReplyDeleteYour St. Louis Fed/blogger colleague was one of the first to do it if I recall correctly.
Yes, Andolfatto was well before his time in that respect. Monika Merz did related work at the same time.
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