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Title: Essays in empirical and theoretical labor market models
Author: Torracchi, Federico
ISNI:       0000 0004 6499 0859
Awarding Body: University of Oxford
Current Institution: University of Oxford
Date of Award: 2016
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This DPhil thesis is a collection of three theoretical and empirical papers studying labor markets in several advanced economies. Two chapters examine the relationship between the banking sector and the labor market in the US and the UK, while one evaluates a policy that has been proposed to help labor markets in the Euro Area adjust to economic shocks. In the first chapter, I develop a New Keynesian DSGE model that integrates a banking sector subject to moral hazard with a standard random search model of the labor market. I estimate the model using US data and study the role of the banking sector in determining labor market fluctuations. In the second chapter, I estimate a structural VAR model of the UK and US economies and identify bank lending shocks using a mix of sign and short-run exclusion restrictions. Consistent with the predictions of the DSGE model, an expansionary loan supply shock decreases job-destruction and increases job-creation, reducing the unemployment rate persistently. Bank lending shocks are also important drivers of labor market fluctuations, particularly during the Great Recession. Lastly, in the third chapter, I calibrate to the Euro Area a currency union DSGE model to evaluate the aggregate properties of European Unemployment Insurance (EUI). I find that EUI cannot contemporaneously stabilize the monetary union and achieve convergence in regional unemployment and inflation rates.
Supervisor: Wren-Lewis, Simon ; Zanetti, Francesco Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available
Keywords: Labor economics ; Economics ; Macroeconomics ; Financial frictions ; Labor market model ; Unemployment insurance ; DSGE ; Banking models ; SVAR