FIGURE 6. Varying degree of search frictions: labour market
Horizontal axes: quarters; vertical axes: percent deviations from the steady state. All variables are in real terms.
4.4 Welfare
In the model with the standard labour market and in the model with search (and in each case for both time-to-build and time-to-plan), most of the output increase occurs later in time if there are delays. However, in some cases, in particular in the case of planning