Suppose that there is technological change that reduces the cost of recruiting for firms. Using the two-sided
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Suppose that there is technological change that reduces the cost of recruiting for firms. Using the two-sided search model, deter-mine the effects on the unemployment rate, the vacancy rate, the labor force, the number of firms, aggregate output, and labor market tightness. Use diagrams, and explain your results.
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The lower recruiting cost k affects only the demand side of the labor market ...View the full answer
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