Research Interests

My research spans a variety of topics in applied microeconomics. My work tries to stay in close contact with facts and data about modern economies, almost exclusively the U.S. economy. Throughout my career, I've been interested in an improved understanding of recessions. Most of my research on this topic has focused on the labor market. The most important feature of a recession is a dramatic rise in unemployment. From the start, I have thought about unemployment in a dynamic setting-for the great majority of workers, unemployment lasts only a few months, but there are always some people unemployed. My recent work has shown that, in today's economy, unemployment does not rise in a recession because of a bulge of layoffs. Instead, it rises because job-seekers take much longer to find new jobs. My work on this topic examines the incentives facing employers and workers to invest in job-creating activities. I have a related interest in the stock market, where values are even more puzzlingly volatile than is the rate of unemployment. I have shown that variations in stock-market returns are vastly larger than variations in the returns to the underlying activities of companies listed in the market. A third interest is in tax policy. I've designed and promoted a tax simplification plan that starts from the principle of the value-added tax-the backbone of European consumption taxation-but creates a progressive version that excuses the poor from any burden of the tax.

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Primary Section

Section 54: Economic Sciences