sticky prices and equilibrium search unemployment that features a shock to the matching efficiency (or mismatch shock). We … find that this shock is almost irrelevant for unemployment fluctuations in normal times. However, it plays a somewhat … larger role during the Great Recession when it contributes to raise the actual unemployment rate by 1.25 percentage points …

sticky prices and equilibrium search unemployment that features a shock to the matching efficiency (or mismatch shock). We … find that this shock is not important for unemployment fluctuations in normal times. However, it plays a somewhat larger … role during the Great Recession when it contributes to raise the actual unemployment rate by around 1.3 percentage points …

This paper bridges the gap between two popular approaches to estimating the natural rate of unemployment, u*. The first … approach uses detailed labor market indicators, such as labor market flows, cross-sectional data on unemployment and vacancies … estimate the natural rate of unemployment in the United States using both data on labor market flows and a forward …