Recent work on money and endogenous growth finds modest welfare costs of inflation. Furthermore, high inflation reduces the growth rate. The author presents a monetary endogenous growth model with labor market frictions in the form of search unemployment which is calibrated for the US economy....

Superneutrality is demonstrated to no longer hold in the Sidrauski model as soll as agents are heterogenous with regard to their productivity. However, quantitative effects of inflation on the capital stock are found to be rather small.

In most OECD countries, unemployment benefits are tied to individual previous labor earnings. We study the progressivity of this indexation with regard to its effects on employment, output, and welfare in a calibrated general equilibrium model with search unemployment. Employment varies...