Aggregate stability under a budget rule and labor mobility

Technology shocks, labor mobility and aggregate fluctuations

We provide evidence on the dynamic behavior of net labor flows across US states in response to a positive technology shock. Technology shocks are identified as disturbances that increase relative state productivity in the long run for 226 state-pairs encompassing 80 percent of labor flows across US states in the period 1976 2008. The data suggest heterogeneous responses of both employment and n...

Aggregate instability under balanced-budget consumption taxes: A re-examination

We re-examine the destabilizing role of balanced-budget fiscal policy rules based on consumption taxation. Using a one-sector model with infinitely-lived households, we consider a specification of preferences derived from Jaimovich (2008) [14] and Jaimovich and Rebelo (2009) [15] which is flexible enough to encompass varying degrees of income effect. When the income effect is not too large, we ...

Investigate the Effects of Public Expenditure on Macroeconomic Variables under a Balanced Budget Rule in Iran: a DSGE Approach

Aggregate Labor Supply

___________________________________________________________________ There have been tremendous advances in macroeconomics, following the introduction of labor supply into the field. Today it is widely acknowledged that labor supply matters for many key economic issues, particularly for business cycles and tax policy analysis. However, the extent to which labor supply matters for such questions ...

Stability of Decision Systems under Majority Rule

As the well-known “Paradox of Voting” indicates, a decision system under majority rule does not necessarily have an equilibrium; that is, it might be that for every alternative there is a majority preferring another. Many writers, particularly political scientists, thus inferred the weakness of majority-rule systems (see, for example, Brams (1976), Riker and Ordeshook (1973)). A social system w...