Arbeitspapier

Credit Market Frictions and the Reallocation Process

In a seminal paper, Davis and Haltiwanger (1990) demonstrate that recessions are associated with an increase in job reallocation, at least in the manufacturing sector. The conventional view has interpreted this as evidence of "cleansing" effects: less productive jobs are destroyed in recessions, and resources are reallocated towards more productive uses. Thus recessions serve to improve allocative efficiency. This paper shows that when credit market frictions are introduced, the result can be reversed. That is, the most efficient jobs are destroyed in recessions, resourses are reallocated towards less productive uses, and misallocation is exacerbated.

Sprache
Englisch

Erschienen in
Series: Discussion Paper ; No. 1251

Klassifikation
Wirtschaft
Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
Business Fluctuations; Cycles
Financial Markets and the Macroeconomy
Thema
Credit Market Imperfections
Job Reallocation
the Cleansing effect

Ereignis
Geistige Schöpfung
(wer)
Barlevy, Gadi
Ereignis
Veröffentlichung
(wer)
Northwestern University, Kellogg School of Management, Center for Mathematical Studies in Economics and Management Science
(wo)
Evanston, IL
(wann)
1999

Handle
Letzte Aktualisierung
10.03.2025, 11:42 MEZ

Datenpartner

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ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Barlevy, Gadi
  • Northwestern University, Kellogg School of Management, Center for Mathematical Studies in Economics and Management Science

Entstanden

  • 1999

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