Equilibrium Unemployment Theory and Developments in the Finnish Labor Market
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School of Business |
Bachelor's thesis
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Authors
Date
2019
Department
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Mcode
Degree programme
Taloustiede
Language
en
Pages
24
Series
Abstract
This thesis is a literature review of the most important theoretical concepts used for analyzing mismatch unemployment, namely the Beveridge curve and the Diamond-Mortensen-Pissarides search and matching model. I describe the foundations of the matching model and discuss the model’s comparative statics and cyclical adjustment mechanism. I also present Shimer’s critique of the matching model and the related theoretical debate, the so-called unemployment volatility puzzle. To conclude the thesis, I describe recent Beveridge curve developments in Finland and consider possible explanations for the increased mismatch in the Finnish labor market.Description
Thesis advisor
Murto, PauliKeywords
labor economics, matching, mismatch unemployment, Beveridge curve, labour market