1. The Cyclicality of the User Cost of Labor
Journal of Monetary Economics, 2014, Vol. 68: 53-67. Link, PDF, Richmond FED WP (WP version with an application to the implicit contracts in the textbook search and matching model)
Abstract: The user cost of labor is the expected difference between the present discounted value of wages paid to a worker hired in the current period and that paid to a worker hired in the next period. Analogous to the price of any long-term asset, the user cost, not wage, is the relevant price for a firm that is considering adding a worker. I construct its counterpart in the data and estimate that it is substantially more procyclical than average wages or wages of newly hired workers. I demonstrate an application of the finding using the textbook search and matching model.
Presentations: Boston College (March 2014), ASSA, Denver CO (2011), Econometric Society European Meeting, Barcelona (2009), Annual Conference of the Canadian Economic Association, Toronto (May 2009), System Macroeconomics Committee Meeting, FRB San Francisco (May 2009), New York/Philadelphia Workshop on Quantitative Macroeconomics, FRB Philadelphia (April 2009), FRB Kansas City (2008), FRB Cleveland (2008), UC Santa Cruz (2008), University of Montreal (2008), Wilfrid Laurier University (2008), Kyiv School of Economics (2008).
2. The Cyclical Price of Labor When Wages Are Smoothed
Richmond FED WP No. 10-13. Link to WP
This is a 2009 working paper (unpublished) that describes the user cost of labor. The key point of this paper is published in "The Cyclicality of the User Cost of Labor" (JME 2014) with an application to the textbook search and matching model.
Presentations: Society of Labor Economists Annual Meetings (2009), EEA Annual Meeting (2009).