Buera, Francisco; Fattal-Jaef, Roberto; Shin, Yongseok - In: Review of Economic Dynamics 18 (2015) 1, pp. 101-117
Why are financial crises associated with a sustained rise in unemployment? We develop a tractable model with frictions in both credit and labor markets to study the aggregate andmicro-level implications of a credit crunch---i.e., a sudden tightening of collateral constraints. When we simulate a...