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In a stochastic economy with overlapping generations, fiscal policy affects the allocation of aggregate risks. The paper shows how to compute the welfare effects of marginal policy changes that shift risk across cohorts, in general and for an application to social security equity investments. I...
Persistent link: https://www.econbiz.de/10005090718
cycle fluctuations in employment and unemployment. They argue that it is likely that wages are not adjusted as regularly as … wages, but wages of newly hired workers. Preliminary results show that wages for those workers are much more volatile than … aggregate wages, suggesting that other (real) frictions might be more important than wage stickiness …
Persistent link: https://www.econbiz.de/10005069278