employment and average productivity.

I find that—when shocks are sufficiently persistent—prices are fully flexible.

Inflation and unemployment are central issues in macroeconomics. While much progress has been made on these issues by incorporating frictions using search theory, existing models analyze either unemployment or inflation. We develop a framework to analyze unemployment and inflation together. This...

The speed at which unemployed workers find jobs depends on their search intensity. Most of the literature defines search intensity as a scalar that influences the arrival rate of job offers. In this paper we treat it explicitly as the number of job applications that workers send out in a given...

We consider a housing market with large numbers of buyers and sellers. Sellers differ in their reservation prices; buyers are ex ante identical. In the first stage of the game, each seller posts an asking price. Next, each buyer, after observing all asking prices, chooses a house to visit. Upon...