BEGIN:VCALENDAR VERSION:2.0 PRODID:-//jEvents 2.0 for Joomla//EN CALSCALE:GREGORIAN METHOD:PUBLISH BEGIN:VEVENT UID:380c708cfcf56589ee739148f3284185 CATEGORIES:Seminars CREATED:20150210T181712 SUMMARY:Virgiliu Midrigan - New York University DESCRIPTION;ENCODING=QUOTED-PRINTABLE:

Debt Constraints and Employment

Abstract:

In the Great Contraction, regions of the United States that expe rienced the largest change in household debt to income ratios also experien ced the largest drops in output and employment. These patterns are difficul t to reconcile with standard models of financial frictions. We develop a mo del with search and matching frictions with on-the-job human capital accumu lation that generates such patterns. We calibrate the amount of on-the-job human capital accumulation so that the model reproduces the wage-tenure pro files in the data. We show that with such upward sloping wage profiles, an unanticipated tightening of borrowing constraints leads consumers to discou nt more the returns to human capital accumulation. Consequently, the match surplus falls and so does the equilibrium number of vacancies firms post. O ur key result is that the tightening of consumer borrowing constraints gene rates a persistent drop in employment and seemingly `sticky’ wages, despite wages being continually negotiated.

DTSTAMP:20260405T144900Z DTSTART:20140529T173000Z DTEND:20140529T190000Z SEQUENCE:0 TRANSP:OPAQUE END:VEVENT END:VCALENDAR