these countries is not economic activity, but wages, which are affected to a large extent by trade unions. Therefore, trade …

explored with the aid of some elements of game theory. It is shown: (a) how labour unions optimally adjust wages to prices …

foreign sector. It is also assumed that wages are not only indexed to the price level, but also respond to the state of the … informational content to wages, over and above the information conveyed by other aggregate prices. The optimal policy in this model … wages are only partially correlated signals about the unobserved disturbances. …