This paper attempts to assess the impact of skill loss on the persistence of cyclical unemployment. The observations from the Current Population Survey and the Bureau of Labor Statistics suggest a countercyclical total unemployment rate that exhibits high persistence. A framework that features...

This paper presents a complete characterization of the optimal policy in a two sector undiscounted growth model. The model is an extension of the Leontief two sector model, which analyzes the optimal allocation of capital and labor to a consumption good sector and an investment good sector. The...