In this paper we estimate a small model of the euro area to be used as a laboratory for evaluating the performance of alternative monetary policy strategies. We start with the relationship between output and inflation and investigate the fit of the nominal wage contracting model due to Taylor...

As inflation rates in the United States decline, analysts are asking if there are economic reasons to hold the rates at levels above zero. Previous studies of whether inflation "greases the wheels" of the labor market ignore inflation's potential for disrupting wage patterns in the same market....

We analyze global data about electricity generation and document that the risk exposure of a firm's owners and its workers depends on competitors' ability or willingness to change their output in response to productivity shocks. Competitor inflexibility appears to be a risk factor: the sales of...