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Embodied Technical Change and the Fluctuations of Unemployment and Wages

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  • Michael Reiter

Abstract

A matching model where technological change is partially embodied in the job match is shown to be successful in explaining the variability of unemployment and vacancies. If we incorporate long‐term wage contracts into the model, it also explains a number of stylized facts on the dynamics of real wages, which have been found in the empirical labor literature.

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  • Michael Reiter, 2007. "Embodied Technical Change and the Fluctuations of Unemployment and Wages," Scandinavian Journal of Economics, Wiley Blackwell, vol. 109(4), pages 695-721, December.
    • Handle: RePEc:bla:scandj:v:109:y:2007:i:4:p:695-721
    DOI: 10.1111/j.1467-9442.2007.00514.x
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    17. Michael Reiter, 2006. "Embodied technical change and the fluctuations of wages and unemployment," Economics Working Papers 980, Department of Economics and Business, Universitat Pompeu Fabra.
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    Cited by:

    1. Martin Gervais & Nir Jaimovich & Henry E. Siu & Yaniv Yedid‐Levi, 2015. "Technological Learning And Labor Market Dynamics," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 56(1), pages 27-53, February.
    2. Haefke, Christian & Sonntag, Marcus & van Rens, Thijs, 2013. "Wage rigidity and job creation," Journal of Monetary Economics, Elsevier, vol. 60(8), pages 887-899.
    3. F. Di Pace & K. Mitra & S. Zhang, 2021. "Adaptive Learning and Labor Market Dynamics," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 53(2-3), pages 441-475, March.
    4. Di Pace, Federico & Villa, Stefania, 2016. "Factor complementarity and labour market dynamics," European Economic Review, Elsevier, vol. 82(C), pages 70-112.
    5. Gabriele Cardullo, 2010. "Matching Models Under Scrutiny: An Appraisal Of The Shimer Puzzle," Journal of Economic Surveys, Wiley Blackwell, vol. 24(4), pages 622-656, September.
    6. Di Pace, Federico & Villa, Stefania, 2016. "Factor complementarity and labour market dynamics," European Economic Review, Elsevier, vol. 82(C), pages 70-112.
    7. F. Di Pace & K. Mitra & S. Zhang, 2021. "Adaptive Learning and Labor Market Dynamics," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 53(2-3), pages 441-475, March.
    8. Ábrahám, Árpád & Laczó, Sarolta, 2024. "Efficient risk sharing and separation," Journal of Economic Theory, Elsevier, vol. 219(C).
    9. Andreas Hornstein & Per Krusell & Giovanni L. Violante, 2007. "Modelling Capital in Matching Models: Implications for Unemployment Fluctuations," Working Papers 2007-2, Princeton University. Economics Department..

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