Publication details

Labour Market Modelling within a DSGE Approach


TONNER Jaromír TVRZ Stanislav VAŠÍČEK Osvald

Year of publication 2013
Type Article in Proceedings
Conference Proceedings of the 31st International Conference Mathematical Methods in Economics
MU Faculty or unit

Faculty of Economics and Administration

Web conference proceedings
Field Economy
Keywords DSGE models; labour market; search and matching; frictions
Description The goal of this paper is to contribute to the understanding of the dynamics of main labour-market variables and their relevance for macroeconomic modelling and forecasting in a period of recession. We consider two ways of incorporating labour market into the New Keynesian DSGE framework. The firs one is rather straightforward and it is based on Jakab and Konya (2009). The second one is more sophisticated and it is based on Christiano et al. (2011). In both cases we extend the DSGE framework with search and matching frictions. Due to the early stage of our research we mainly focus on the literature review in this paper but we also provide some preliminary empirical results. In-sample forecasts generated on calibrated models are employed to evaluate their predictive power.
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