This paper discusses the challenges that European Monetary Union (EMU) poses for European labor markets, emphasizing in particular the regional dimension of the European unemployment problem. The authors argue that the inability of labor markets to adjust to shocks is largely a regional problem...

This paper examines the sources of disturbances to output in the United States and a set of EU countries and analyzes labor market adjustment mechanisms in these two economic areas. Comparable datasets comprising 1-digit sectoral data for eight U.S. regions and eight European countries are...

We analyze the flexibility of the Canadian labor market across provinces in both an interand intra-national context using macroeconomic data on employment, unemployment, participation, and (for Canada) migration and real wages. We find that Canadian labor markets respond in a similar manner to...

The paper provides an empirical investigation of labor market pooling. The analysis concentrates on Italian industrial districts and shows that there is scattered evidence of a widespread wage premium. In particular, there is no evidence of district differentials for the returns to seniority...

This paper estimates a New Keynesian DSGE model with an explicit financial intermediary sector. Having measures of financial stress, such as the spread between lending and borrowing, enables the model to capture the impact of the financial crisis in a more direct and efficient way. The model...

Motivated by the increasing interest in analyzing the links between the financial sector and the real economy, we develop a macro-financial structural model with two novel features. First, we include idiosyncratic and aggregate risk in a tractable general equilibrium model. This allows us to...

One of the most puzzling facts in the wake of the Global Financial Crisis (GFC) is that output across advanced and emerging economies recovered at a much slower rate than anticipated by most forecasting agencies. This paper delves into the mechanics behind the observed slow recovery and the...

This paper provides new empirical evidence on the degree of nominal wage flexibility in a sample of nineteen industrial countries. Across countries, aggregate uncertainty increases the degree of wage flexibility in the face of various shocks. Wage flexibility stabilizes fluctuations in real...

Empirical evidence for small developed economies finds that consumption is procyclical and as volatile as output, and real net exports are coutercyclical. Earlier studies have not been able to reproduce these regularities in a DSGE small open economy model when productivity shocks drive the...