This paper develops the Michez rule, a method to detect US recessions using data on unemployment and job vacancies. In December 2024, the rule gives a recession probability of 27%; this recession risk was first detected in March 2024.
This course presents a matching model of unemployment. It uses the model to study unemployment fluctuations; job rationing; efficient unemployment and unemployment gap; and labor market policies such as minimum wage, public employment, and unemployment insurance.
This paper builds a Beveridgean model of the Phillips curve. Prices respond to slack so the divine coincidence holds: prices are stable at full employment. The Phillips curve is kinked if wage cuts are more costly to producers than price hikes.
This paper argues that in the United States the full-employment rate of unemployment (FERU) is the geometric average of the unemployment and vacancy rates. Between 1930 and 2024, the FERU averages 4.1% and is very stable.
This graduate course presents various matching models of economic slack. It uses them to study business-cycle fluctuations; Keynesian, classical, and frictional unemployment; optimal monetary policy and the zero lower bound; and optimal government spending.
This minicourse presents basic facts about business cycles. It then develops a matching model to explain these business-cycle facts. Finally, it explains how monetary policy and government spending should be designed to tame business cycles.
This paper develops a sufficient-statistic formula for the unemployment gap. The formula depends on the elasticity of the Beveridge curve, cost of unemployment, and recruiting cost. In the United States the unemployment gap is countercyclical and often positive.