This paper analyses how labour market heterogeneity affects unemployment, productivity and business cycle dynamics that are relevant for monetary policy. The model matches remarkably well the short and long run dynamics of skilled and unskilled workers. Skill mismatch and skill-specific labour...

Since the advent of Heterogeneous Agent New Keynesian (HANK) models, countercyclical unemployment risk has been deemed an important amplification mechanism for business cycles shocks. Yet, the aggregate effects of such "unemployment fears" are hard to pin down. We thus revisit this issue in the...

Since the advent of Heterogeneous Agent New Keynesian (HANK) models, countercyclical unemployment risk has been deemed an important amplification mechanism for business cycles shocks. Yet, the aggregate effects of such "unemployment fears" are hard to pin down. We thus revisit this issue in the...

Crime fell sharply in the United States during the Great Recession, at a time of deep economic decline. This was a puzzle: crime is expected to rise, not fall, when unemployment rises. Using a novel identification strategy, I show that unemployment insurance (UI) benefit extensions can account...