Interacting nominal and real labour market rigidities

Abstract: This note investigates the interaction between nominal and real labour market rigidities. It shows nominal wage rigidity to have little effect on the welfare loss from labour adjustment costs under a labour supply shock. This implies that the second best effect of nominal price stickiness under real wage persistence studied in Duval and Vogel (2007) does not apply to the propagation of supply shocks under nominal wage rigidity and labour adjustment costs.

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Year of publication:	2008-11
Authors:	Vogel, Lukas
Institutions:	Volkswirtschaftliche Fakultät, Ludwig-Maximilians-Universität München
Subject:	Labour adjustment costs \| wage stickiness \| rigidity interaction

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Extent:	application/pdf
Series:	MPRA Paper.
Type of publication:	Book / Working Paper
Classification:	E32 - Business Fluctuations; Cycles ; E24 - Employment; Unemployment; Wages ; J23 - Employment Determination; Job Creation; Demand for Labor; Self-Employment ; J30 - Wages, Compensation, and Labor Costs. General
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005623509