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Recall and Unemployment

Resource type
Authors/contributors
Title
Recall and Unemployment
Abstract
We document in the Survey of Income and Program Participation covering the period 1990–2013 that a surprisingly large share of workers return to their previous employer after a jobless spell, and experience very different unemployment and employment outcomes than job switchers. The probability of recall is much less procyclical and volatile than the probability of finding a new employer. We add to a quantitative, and otherwise canonical, search-and-matching model of the labor market a recall option, which can be activated freely following aggregate and job-specific productivity shocks. Recall and search effort significantly amplify the cyclical volatility of new job-finding and separation probabilities.
Publication
American Economic Review
Volume
107
Issue
12
Pages
3875-3916
Date
2017-12
Citation
Fujita, S., & Moscarini, G. (2017). Recall and Unemployment. American Economic Review, 107, 3875–3916.
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