haku: @all turnover / yhteensä: 1051
viite: 29 / 1051
| Tekijä: | Choudhary, M.A. Levine, P. |
| Otsikko: | Risk-averse firms and employment dynamics |
| Lehti: | Oxford Economic Papers
2010 : JUL, VOL. 62:3, p. 578-602 |
| Asiasana: | risk aversion employment stabilization unemployment |
| Kieli: | eng |
| Tiivistelmä: | This paper shows that high risk-aversion in firms speed up the adjustment process of unemployment to its natural levels when employers face either temporary or permanent shocks in a turnover-training model where firms fix high wages to lower worker turnover. Hence, risk aversion has a stabilizing affect on the macroeconomy. This result complements the existing explanations for unemployment persistence and it raises a general point concerning the wide-spread assumption of risk-neutrality on the part of firms in the real business cycle and New Keynesian DSGE literatures. The analysis suggests that this is not an innocuous assumption for assessing fluctuations and the appropriate policy response. Assuming firms to be risk-neutral understates their self-stabilization characteristics. This leads to an exaggerated stabilization role for monetary and fiscal policy. |
SCIMA