The Vanishing Procyclicality of Labour Productivity
Abstract
We document two changes in post-war US macroeconomic
dynamics: the procyclicality of labour productivity
vanished, and the relative volatility of employment rose. We propose an
explanation for these changes that is based on reduced hiring frictions due to improvements
in information about the quality of job matches and the resulting decline in
turnover. We develop a simple model with hiring frictions and variable effort
to illustrate the mechanisms underlying our explanation. We show that our model
qualitatively and quantitatively matches the observed changes in business cycle
dynamics.
Published (January 2021): The Economic Journal,
131(633), pp.302–326, https://doi.org/10.1093/ej/ueaa065
January 2019 [download pdf] – Earlier version (January 2014) also
available as CEPR
Discussion Paper 9853
Previous versions: April
2017 (appendices), September 2008, October
2009, July 2010 (also available as IZA
Discussion Paper 5099), and January 2014
First version: August 2008
Data
All data refer to the US over the postwar period and
are obtained from publicly available sources, see the paper for details.
· Dataset in Stata format and comma-separated
format
· Stata code
used to construct this dataset from original data sources
· Stata code
to calculate business cycle statistics (with standard errors)
Programs
We used Dynare version 4.0.3 for Matlab to simulate a second order approximation of the
model.
·
Matlab code
to produced the simulated moments
·
Dynare mod-file
with the model definition
If you have any questions about these data or
programs, please email me.
Thijs van Rens | IDEAS/RePEc | Google Scholar | ResearchGate