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Nominal Wage Rigidities in a New Keynesian Model with Frictional Unemployment
Bodart, Vincent; Walque, Gregory De; Pierrard, Olivier; … - Institute for the Study of Labor (IZA) - 2006
In this paper, we propose a search and matching model with nominal stickiness à la Calvo in the wage bargaining. We analyze the properties of the model, first, in the context of a typical real business cycle model driven by stochastic productivity shocks and second, in a fully specified...
Persistent link: https://www.econbiz.de/10005703177
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Sequential Bargaining in a New-Keynesian Model with Frictional Unemployment and Staggered Wage Negotiation
De Walque, Gregory; Pierrard, Olivier; Sneessens, Henri; … - Institute for the Study of Labor (IZA) - 2009
We consider a model with frictional unemployment and staggered wage bargaining where hours worked are negotiated every period. The workers' bargaining power in the hours negotiation affects both unemployment volatility and inflation persistence. The closer to zero this parameter, (i) the more...
Persistent link: https://www.econbiz.de/10005703208
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The Role of Real Wage Rigidity and Labor Market Frictions for Unemployment and Inflation Dynamics
Christoffel, Kai; Linzert, Tobias - Institute for the Study of Labor (IZA) - 2005
In this paper we incorporate a labor market with matching frictions and wage rigidities into the New Keynesian business cycle model. In particular, we analyze the effect of a monetary policy shock and investigate how labor market frictions affect the transmission process of monetary policy. The...
Persistent link: https://www.econbiz.de/10005703779
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Price Dynamics and Production Lags
Lindbeck, Assar; Snower, Dennis J. - Institute for the Study of Labor (IZA) - 1999
This paper provides a new explanation of why inflation is sluggish in response to aggregate demand shocks and why aggregate output changes as result of such shocks. We argue that these phenomena are related to lags between inputs and outputs in the production process, "production lags" for...
Persistent link: https://www.econbiz.de/10005702997
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Monetary Policy and Swedish Unemployment Fluctuations
Alexius, Annika; HOLMLUND, BERTIL - Institute for the Study of Labor (IZA) - 2007
A widely spread belief among economists is that monetary policy has relatively short-lived effects on real variables such as unemployment. Previous studies indicate that monetary policy affects the output gap only at business cycle frequencies, but the effects on unemployment may well be more...
Persistent link: https://www.econbiz.de/10005763620
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Identifying the Common Component of International Economic Fluctuations: A New Approach
Lumsdaine, Robin L.; Prasad, Eswar S. - Institute for the Study of Labor (IZA) - 2002
In this paper, we develop an aggregation procedure using time-varying weights for constructing the common component of international economic fluctuations. The methodology for deriving time-varying weights is based on some stylized features of the data documented in the paper. The model allows...
Persistent link: https://www.econbiz.de/10005822387
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Expected Inflation, Sunspots Equilibria and Persistent Unemployment Fluctuations
Dufourt, Frédéric; Lloyd-Braga, Teresa; Modesto, Leonor - Institute for the Study of Labor (IZA) - 2009
We propose and estimate a model where unemployment fluctuations result from self-fulfilling changes in expected inflation (sunspot shocks) affecting nominal wage bargaining. Since the estimated parameters fall near the locus of Hopf bifurcations, country-specific expected inflation shocks can...
Persistent link: https://www.econbiz.de/10005002829
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Nowcasting Business Cycles Using Toll Data
Askitas, Nikos; Zimmermann, Klaus F. - Institute for the Study of Labor (IZA) - 2011
Nowcasting has been a challenge in the recent economic crisis. We introduce the Toll Index, a new monthly indicator for business cycle forecasting and demonstrate its relevance using German data. The index measures the monthly transportation activity performed by heavy transport vehicles across...
Persistent link: https://www.econbiz.de/10008854242
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Business Cycle Effects of Credit and Technology Shocks in a DSGE Model with Firm Defaults
Pesaran, Hashem; Xu, TengTeng - Institute for the Study of Labor (IZA) - 2011
This paper proposes a theoretical framework to analyze the impacts of credit and technology shocks on business cycle … financial institutions in the transmission of credit and technology shocks to the real economy. A positive credit shock, defined … between loan and deposit rates. The effects of the credit shock tend to be highly persistent even without price rigidities and …
Persistent link: https://www.econbiz.de/10009325438
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Asymmetric Labor Market Institutions in the EMU and the Volatility of Inflation and Unemployment Differentials
Abbritti, Mirko; Mueller, Andreas I. - Institute for the Study of Labor (IZA) - 2012
How does the asymmetry of labor market institutions affect the adjustment of a currency union to shocks? To answer this question, this paper sets up a dynamic currency union model with monopolistic competition and sticky prices, hiring frictions and real wage rigidities. In our analysis, we...
Persistent link: https://www.econbiz.de/10011279349