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Fumitaka Furuoka
''Does the Shimer puzzle really exist in the American labour market? ''
( 2021, Vol. 41 No.3 )
This paper employs a dynamic stochastic general equilibrium (DSGE) method to systematically compare Shimer's and Hagedorn–Manovskii's calibration approaches to the analysis of the Shimer puzzle. The findings indicate that adopting an appropriate calibration strategy may help with solving two aspects of the Shimer puzzle by generating more accurate standard errors for unemployment and elasticity of the v–u ratio with respect to productivity. However, there still remains a tendency to fail to generate an accurate standard deviation for vacancy, which is the unsolvable aspect of the Shimer puzzle.
Keywords: Search model, Shimmer puzzle, Mortensen–Pissarides model, dynamic stochastic general equilibrium
JEL: E2 - Macroeconomics: Consumption, Saving, Production, Employment, and Investment: General (includes Measurement and Data)
J6 - Mobility, Unemployment, and Vacancies: General
Manuscript Received : Mar 04 2020 Manuscript Accepted : Jul 18 2021

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