Frictional labor markets and policy interventions : dynamics and welfare implications.

Summary The underlying objective of the three chapters that make up this thesis is to understand the functioning of the labor market in order to establish a diagnosis of the potential regulatory role of a public authority in this market. In the first chapter, I analyze, from a purely "positive" point of view, the ability of the model with matching frictions to replicate short term fluctuations of labor market variables in the United States. I propose a new calibration strategy, in the framework of a model of fluctuations with price rigidity. In the second chapter (co-authored with F. Langot), we study the determinants of labor supply changes over the last fifty years. The evolution of the tax wedge, as well as of two variables reflecting the institutional framework (the generosity of income in case of "non-employment" and the bargaining power of workers), help explain the different trajectories of the employment rate and hours worked observed in the United States and in three European economies (France, Germany and the United Kingdom). In the third chapter, I analyze the performance of two alternative social security systems in a model with wealth heterogeneous agents. Agents are subject to the risk of unemployment, and the planner can provide insurance through a redistributive tax system, based on a progressive tax and/or unemployment insurance. The progressive tax system is superior, in terms of aggregate welfare, to the insurance provided through unemployment benefits, through its effect on the functioning of the labor market.