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Dynamic rational expectation models are more difficult to solve than standard dynamic models. These technical difficulties have probably hindered the development and use of such models at the empirical level. The purpose of this paper is to introduce the principal methods of solution to potential builders and users of such models.
In this paper we present and analyze the IMF’s labor market recommendations for advanced economies since the beginning of the crisis, both in general and specifically in program countries. Our analysis is informed by our reading of the theoretical and empirical literature on the design of labor market policies and institutions in advanced economies. We organize our discussion around two concepts:...
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