In this paper we study the relationship between labour market institutions and monetary policy. We use a simple macroeconomic framework to show how optimal monetary policy rules depend on labour institutions (labour adjustment costs, and nominal and real wage rigidity) and social preferences...

This paper examines the evolution of the Phillips Curve (PC) for the Spanish economy since 1980. In particular, we focus on what has happened since the late 1990s. Since 1999 the unemployment rate has fallen by almost 7 percentage points, while inflation has remained relatively subdued around a...

The Phillips curve has flattened in Spain over 1995-2006: unemployment has fallen by 15 percentage points, with roughly constant inflation. This change has been more pronounced than elsewhere. We argue that this stems from the immigration boom in Spain over this period. We show that the New...