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Schedule of Reading Presentations

Tuesday 14 January

Tuesday 21 January

Tuesday 28 January

Tuesday 4 February

Tuesday 11 February

  • Shimer (2005) – Jumur Jamal
  • Hall (2005) – Matt Ramos
  • Hagedorn and Manovskii (2008) – Bodi Dallas
  • Hall and Milgrom (2008) – This paper proposes a form of wage bargaining that produces somewhat-rigid wages. With such wage rigidity, the matching model generates realistic fluctuations in unemployment and vacancies.
  • Blanchard and Gali (2010) – This paper blends the matching model of the labor market with a New Keynesian model of the product market. It then shows that under wage bargaining, unemployment and vacancies do not fluctuate at all in the model. This is a strong form of the Shimer puzzle. By contrast, when the real wage is a subproportional function of labor productivity, the model generates realistic fluctuations in unemployment and vacancies.
  • Eliaz and Spiegler (2013) – This paper insert reference-dependent preferences into a matching model. Because of these preferences, wage cuts relative to a reference point make workers feel that they have been treated unfairly, which dampens their intrinsic motivation and reduces their output. As a result, firms avoid cutting wages. Because wages are rigid downward, unemployment and vacancies respond more to shocks than under Nash bargaining.

Tuesday 18 February

  • Michaillat (2012) – Matthew Choi
  • Crepon, Duflo, Gurgand, Rathelot, and Zamora (2013) – This paper reports the results from a randomized experiment designed to evaluate the direct and indirect effects of job-placement assistance on the labor market outcomes of young educated jobseekers in France. It finds that jobseekers who are given job-placement assistance find jobs more rapidly, while jobseekers in the same labor market who are not assisted take longer to find a job. This finding suggests that jobs are somewhat rationed, and that assisted jobseekers move ahead of non-assisted jobseekers in job queues. The spillovers of job-placement assistance are particularly strong in bad times, when jobs are scarcer.
  • Akerlof, Rose, and Yellen (1988) – Bodi Dallas
  • Michaillat and Saez (2015) – This paper adds aggregate demand to the model in Michaillat (2012). This is done by adding a product market to the labor market with a similar matching structure. Aggregate demand shocks generate fluctuations in unemployment and vacancies along the Beveridge curve. In that model, unemployment can be decomposed into three components: Keynesian unemployment (due to insufficient aggregate demand), classical unemployment (due to high real wages), and frictional unemployment (due to matching frictions).
  • Michaillat and Saez (2022) – This paper builds a dynamic version of the model in Michaillat and Saez (2015), which is static. In this model the central bank can influence aggregate demand and unemployment through interest rates.
  • Michaillat and Saez (2024) – This paper uses the dynamic model in Michaillat and Saez (2022) and generates a Phillips curve by introducing price competition through directed search. To ensure that unemployment fluctuates, the model assumes price rigidity through quadratic price-adjustment costs. The Phillips curve produced by the model guarantees divine coincidence: inflation is on target when unemployment is efficient.

Tuesday 25 February

Tuesday 4 March