Public Employment and the Business Cycle

20 Pages Posted: 29 Feb 2008

See all articles by Vincenzo Quadrini

Vincenzo Quadrini

University of Southern California - Marshall School of Business - Finance and Business Economics Department; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Antonella Trigari

Bocconi University - Department of Economics

Abstract

We add a public employment sector to the basic search and matching model in order to study the business cycle impact of public wage and employment policies. The government is assumed to follow exogenous rules for public wages and employment calibrated to match some cyclical features of US policies. These features include a positive public wage premium and mildly procyclical public wages and employment. We find that the presence of the public sector increases the volatility of employment and output.

Keywords: Job search, public employment, business cycle

JEL Classification: E6, E32, J64

Suggested Citation

Quadrini, Vincenzo and Trigari, Antonella, Public Employment and the Business Cycle. Scandinavian Journal of Economics, Vol. 109, Issue 4, pp. 723-742, March 2008, Available at SSRN: https://ssrn.com/abstract=1098465 or http://dx.doi.org/10.1111/j.1467-9442.2007.00517.x

Vincenzo Quadrini (Contact Author)

University of Southern California - Marshall School of Business - Finance and Business Economics Department ( email )

Marshall School of Business
Los Angeles, CA 90089
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Antonella Trigari

Bocconi University - Department of Economics ( email )

Via Gobbi 5
Milan, 20136
Italy

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
8
Abstract Views
925
PlumX Metrics