cumulative effect on the firm's markup. …

following five questions: 1) To what extent does an economy subject to regular variations in labour productivity growth differ … from one where labour productivity is constant? 2) What is the impact on major macroeconomic indicators of a one …-time change in labour productivity growth? 3) What are the business cycle implications of autonomous (non-falsifiable) changes in …

] the psychological assumptions that (1) consumers dislike paying a price that exceeds some ``fair'' markup on firms …

instrumenting is particularly important for estimating the effect of competition on the markup of the price leader. …

, and a fall in the markup. This evidence is robust across alternative empirical methodologies used to identify innovations …

predictions of this model against data from the British Household Panel Survey, using earnings as a proxy for productivity. We … theoretical calculations show that the estimated earnings differentials represent average productivity differentials net of … monitoring costs, but not of the disutility of additional effort expended by workers. But the productivity differential is not a …