Buera, Francisco J.
[VerfasserIn]
;
Fattal-Jaef, Roberto
[Sonstige Person, Familie und Körperschaft];
Shin, Yongseok
[Sonstige Person, Familie und Körperschaft]National Bureau of Economic Research
Anatomy of a Credit Crunch
: From Capital to Labor Markets
Erschienen:
Cambridge, Mass: National Bureau of Economic Research, March 2014
Erschienen in:NBER working paper series ; no. w19997
Umfang:
1 Online-Ressource
Sprache:
Englisch
DOI:
10.3386/w19997
Identifikator:
Reproduktionsnotiz:
Hardcopy version available to institutional subscribers
Entstehung:
Anmerkungen:
Mode of access: World Wide Web
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Beschreibung:
Why are financial crises associated with a sustained rise in unemployment? We develop a tractable model with frictions in both credit and labor markets to study the aggregate and micro-level implications of a credit crunch--i.e., a tightening of collateral constraints. When we simulate a credit crunch calibrated to match the observed decline in the ratio of debt to non-financial assets of the United States business sector following the 2007-8 crisis, our model generates a sharp decline in output--explained by a drop in aggregate total factor productivity and investment--and a protracted increase in unemployment. We then explore the micro-level impact by tracking the employment dynamics for firms of different sizes and ages. The credit crunch causes a much larger reduction in the net employment growth rate of small, young establishments relative to that of large, old producers, consistent with the recent empirical findings in the literature