A model of the labor market under firing restrictions and endogenous quits is constructed. It is shown that in the spirit of Blanchard and Summers, the model can generate multiple equilibria for plausible parameter values, with a low quits/high unemployment equilibrium coexisting with a high quits/low unemployment equilibrium.
|Original language||English (US)|
|Number of pages||24|
|Journal||Quarterly Journal of Economics|
|State||Published - May 1995|
ASJC Scopus subject areas
- Economics and Econometrics