Stock–flow matching

Ebrahimy, Ehsan; Shimer, Robert

doi:10.1016/j.jet.2010.02.012

Cited by 56 publications

(53 citation statements)

References 21 publications

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“…This observation may be evidence of recall unemployment, whereby workers enter unemployment and then quickly return to the same positions they left, which was shown to be quite prevalent by Fujita and Moscarini (2013). These very fast job finders are also consistent with a model of stock-flow matching, as in Ebrahimy and Shimer (2010) and Hawkins and Carrillo-Tudela (2016), whereby workers who first enter unemployment have a large stock from which to search but afterward must wait for the flow. If these patterns in the data were truly generated by stock-flow matching, then our initial assumption that there is no individual-level heterogeneity would be misguided.…”

Section: Composition Behind Duration Dependencesupporting

confidence: 70%

Duration Dependence and Composition in Unemployment Spells

Eubanks

Wiczer

2016

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Labor markets have improved considerably since the Great Recession. However, one indicator of labor market health, the mean duration of unemployment, remains stubbornly high. The mean duration of unemployment measures the number of weeks the average unemployed worker has been without a job. While the unemployment rate has nearly returned to pre-recession levels, the mean duration of unemployment is still more than 1.6 times higher than it was on the eve of the Great Recession. But the mean duration of unemployment does not fully capture how long most unemployed workers should expect to remain unemployed. Empirical evidence has consistently shown that those unemployed for a longer time-a year, for example-are less likely to find a job in a given month than those unemployed for a shorter time-say, a few weeks. As a result, those who do not find a job in the first few months of unemployment are likely to remain unemployed for a long time, and these long-term unemployed workers increase the mean duration of unemployment beyond what most unemployed workers will experience. This relationship between the length of time a worker has been unemployed and the likelihood of finding a job is known as duration dependence.This article reviews the evidence for duration dependence in job-finding rates and its implications for the unemployment duration distribution. The authors document duration dependence and show that it exists within nearly every demographic subgroup. Then, they examine the implications of duration dependence on unemployment duration, emphasizing that a uniform job-finding rate that does not incorporate duration dependence understates unemployment duration. Finally, they explore a composition-based approach to duration dependence, where they solve for the distribution of preexisting heterogeneity that is consistent with observed duration dependence.

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Section: Composition Behind Duration Dependencesupporting

confidence: 70%

Duration Dependence and Composition in Unemployment Spells

Eubanks

Wiczer

2016

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“…17 The results are quantitatively similar. In response to a positive productivity shock, firms create more jobs, only some of which are suitable for unemployed workers.…”

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confidence: 62%

Labor Markets and Business Cycles

Shimer¹

2010

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“…In some markets, observable trading mechanics are naturally represented by more specific matching technologies 4 . For instance, in the housing market, search frictions are well described by a stock‐flow matching process (Taylor 1995, Coles and Smith 1998, Ebrahimy and Shimer 2006). In the context of the housing market, a stock‐flow matching process assumes that a new buyer first inspects all the houses that are on sale.…”

Section: Matching Frictionsmentioning

confidence: 99%

Liquidity in Frictional Asset Markets

Rocheteau¹,

Weill²

2011

J of Money Credit Banking

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a conference on "Liquidity in frictional asset markets." In this paper, we review the literature on asset markets with trading frictions in both finance and monetary theory using a simple search-theoretic model, and we discuss the papers presented at the conference in the context of this literature. We will show the diversity of topics covered in this literature, for example, the dynamics of housing and credit markets, the functioning of payment systems, optimal monetary policy and the cost of inflation, the role of banks, the effect of informational frictions on asset trading.JEL codes: D80, E40, E50, G1

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Stock–flow matching

Cited by 56 publications

References 21 publications

Duration Dependence and Composition in Unemployment Spells

Duration Dependence and Composition in Unemployment Spells

Labor Markets and Business Cycles

Liquidity in Frictional Asset Markets

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