Are the Unemployed Unemployable?

Download or read book Are the Unemployed Unemployable? written by Gilles Saint-Paul and published by International Monetary Fund. This book was released on 1994-06-01 with total page 24 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper develops a matching model of the labor market under wage rigidity when hiring decisions are irreversible. There are two types of workers, the skilled and the unskilled. The model is used to analyze whether technological advances may have increased unemployment. It is shown that it is likely to be so if they are associated with an increase in the productivity and/or the supply of skilled workers relative to unskilled workers. These effects are stronger when hiring decisions are more irreversible.