Household Debt Overhang and Unemployment
用劳动搜索模型解释为何家庭债务扩张后常伴随严重失业，发现有限责任保护下的家庭因债务积压要求高工资，企业减少招聘导致失业上升，且债务水平因外部性而过高，金融监管可缓解此问题。
ABSTRACT We use a labor‐search model to explain why the worst employment slumps often follow expansions of household debt. We find that households protected by limited liability suffer from a household‐debt‐overhang problem that leads them to require high wages to work. Firms respond by posting high wages but few vacancies. This vacancy posting effect implies that high household debt leads to high unemployment. Even though households borrow from banks via bilaterally optimal contracts, the equilibrium level of household debt is inefficiently high due to a household‐debt externality . We analyze the role that a financial regulator can play in mitigating this externality.