TY  - SER
AU  - Kudlyak, Marianna
TI  - How Cyclical Is the User Cost of Labor?
SN  - 0895-3309
PB  - Journal of Economic Perspectives
KW  -  Aggregate Human Capital
KW  -  Aggregate Labor Productivity, Business Fluctuations
KW  -  Employment
KW  -  Intergenerational Income Distribution
KW  -  Wages
KW  - Unemployment
N2  - In employment relationships, a wage is an installment payment on an implicit long-term agreement between a worker and a firm. The price of labor that impacts firm's hiring decisions, instead, reflects the hiring wage as well as the impact of economic conditions at the time of hiring on future wages. Measured by the labor's user cost, the price of labor is substantially more pro-cyclical than the new-hire wage or the average wage. The strong procyclicality of the price of labor calls for other forces for cyclical labor demand to explain employment fluctuations
UR  - https://www.aeaweb.org/articles?id=10.1257/jep.38.2.159
ER  -