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policies can play an important role in shaping the trade-off. Third, nominal wages tend to be endogenously rigid also upward …
Persistent link: https://www.econbiz.de/10005825999
We propose a theory of low-frequency movements in unemployment based on asymmetric real wage rigidities. The theory generates two main predictions: long-run unemployment increases with (i) a fall in long-run productivity growth and (ii) a rise in the variance of productivity growth. Evidence...
Persistent link: https://www.econbiz.de/10008727811