The paper argues that when some states are tight while others remain slack, a policy rule that also reacts to cross-state dispersion in unemployment gaps can deliver better inflation and slack outcomes than a rule based only on the national mean. The takeaway is a policy design point: heterogeneity is a potentially useful state variable for stabilization, not just a distributional detail.
This paper constructs monthly state-level full-employment unemployment rates and shows that persistent regional variation changes how policymakers should interpret full employment, labor-market slack, and national monetary-policy stance.
Using state-level variation, this project studies how unemployment insurance, occupational licensing, minimum wages, and other institutions shape structural unemployment across the United States.
This paper demonstrates that the extent to which unemployed human capital is heterogeneous and specific, rather than homogeneous and general, plays a key role in the labor market, accounting for a significant share of joblessness in the pre-COVID era.