Inventories, employment and hours

Employment and Hours of Work

This paper develops a dynamic model of the labor market in which the degree of substitution between employment and hours of work is determined as part of a search equilibrium. Each firm chooses the demand for working hours and the number of vacancies, and the hourly wage rate is determined by Nash bargaining. A firm increases the demand for hours as recruitment becomes more costly. Labor market...

Substituting Working Hours with Employment :

Employment and hours over the business cycle*

Approximately one quarter of the adjustment in total hours of employment over the business cycle represents adjustments in hours, while the remainder is explained by changes in employment. Real business cycle models characterize agents as either continuously adjusting their hours or making only labor force participation decisions about jobs with indivisible hours, In this paper we extend the re...

Employment Stability via Annualized Hours Contracts?

The presented paper proves that working time arrangements, which include hours flexibility and enable hours deposits, are appealing under product market uncertainty. The model integrates efficiency wage arguments into an implicit insurance–contract environment, thus extending the existing literature. The solutions are renegotiation–proof and the long–run optimum is spot implementable. Moreover,...

Dynamic employment and hours e!ects of government spending shocks

In this paper, we analyze the dynamic behavior of employment and hours worked per worker in a stochastic general equilibrium model with a matching mechanism between vacancies and unemployed workers. The model is estimated for the US using the Generalized Methods of Moments (GMM) estimation technique. An increase in government spending raises hours worked per worker, and crowds out private consu...