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SUMMARY:Who Bears the Cost of Aggregate Fluctuations and Why?
DTSTART:20230421T103000
DTEND:20230421T120000
DTSTAMP:20260916T193728Z
UID:84e3b2e695c3237ae0d1c226cfcde3ecfc0c175403f808645fdce219
CATEGORIES:Conferences - Seminars
DESCRIPTION:Dimitris Papanikolaou - Kellogg School of Management\nRecessio
 ns are typically associated with lower firm cashflows and higher discount 
 rates. We show that these two components have very different implications 
 for labor income growth.\nHigher discount rates lead to lower worker earni
 ngs for workers at the bottom of the income distribution\; these declines 
 are primarily driven by job separations. By contrast\, lower cashflow (Or
  productivity) news is followed by declines in earnings for workers at the
  top of the income distribution\, with most of the effect coming from the 
 intensive margin. We build an equilibrium model of labor market search th
 at quantitatively replicates these facts. The model matches several styliz
 ed features of the data: the level of unemployment volatility with procycl
 ical job finding rates and countercyclical job destruction rates\; counte
 rcyclical tail risk in labor income growth\; the low level of cyclicality 
 of the average wage\; the U-shaped sensitivity of worker earnings to aggr
 egate output by prior income\; and the cyclical evolution of income inequa
 lity.\n 
LOCATION:UniL Campus\, Room Extra 126
STATUS:CONFIRMED
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