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...

The paper examines why ‘globaphobia’ seems to be more prevalent among labour in the United States than in Europe. It argues that globalization has generated more wealth, but also more income inequality and adjustment problems, in America than in Europe. In the United States, the median voter...

This paper provides insights into the relationship between the substantial ageing of the European labour force, large migration movements, and individual labour mobility. First, qualitative predictions are derived using the theory of production with multiple inputs. Second, quantitative...

This paper considers a simple model of economic transition to analyse the dynamics of preferences over economic policy. I consider an economy with two sectors: a high-productivity private sector, which initially employs a small share of the economy's work-force, and a low-productivity state...

Firms are the field of several strategic interactions that standard neo-classical analysis often ignores. Such strategic considerations concern relations between capital owner and labour, relations between marginal employees and incumbents and more generally all relations between different...

This paper examines competitive search equilibrium when workers' effort choice and 'type' are private information. We derive a modified Hosios Rule determining the allocation of resources, and analyze how private information influences the responsiveness of the unemployment rate to changes in...

This Paper presents a reappraisal of unemployment movements in the European Union. Our analysis is based on the chain reaction theory of unemployment, which focuses on (a) the interaction among labour market adjustment processes, (b) the interplay between these adjustment processes and the...

In this Paper, we discuss the main characteristics of European mandatory pension systems and the implications for these systems of increasing factor mobility. In particular, we expect the extent of redistribution (both intra- and intergenerational) in national pension systems to decrease. The...

This paper explores the two common concepts of the natural rate of unemployment: (i) the stable, long-run equilibrium rate of unemployment; and (ii) the equilibrium unemployment rate at which there is no tendency for this rate to change, given the exogenous variables. The first concept (common...

Since the 1970s Britain has gone from being a country of net emigration to one of net immigration, with a trend increase in immigration of more than 100,000 per year. This Paper represents the first attempt to model the variations in net migration for British and for foreign citizens, across...