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Pesaran, Mohammad Hashem; Chudik, Alexander - 2011

This paper considers the problem of aggregation in the case of large linear dynamic panels, where each micro unit is … Pesaran (2003), an optimal aggregate function is derived, and the limiting behavior of the aggregation error is investigated … which observed inflation persistence at the aggregate level is due to aggregation and/or common unobserved factors. Our …

Persistent link: https://www.econbiz.de/10010285520

Aggregation in Large Dynamic Panels

Pesaran, Hashem; Chudik, Alexander - Institute for the Study of Labor (IZA) - 2011

This paper considers the problem of aggregation in the case of large linear dynamic panels, where each micro unit is … Pesaran (2003), an optimal aggregate function is derived, and the limiting behavior of the aggregation error is investigated … which ‘observed’ inflation persistence at the aggregate level is due to aggregation and/or common unobserved factors. Our …

Persistent link: https://www.econbiz.de/10008839293

Minority Inflation, Unemployment, and Monetary Policy

Lee, Munseob; Macaluso, Claudia; Schwartzman, Felipe - 2024

Our paper addresses the heterogeneous effects of monetary policy on households of different races. The cyclical volatility of real income differs significantly for households of different races and income levels, reflecting differential exposure to fluctuations in employment and consumer prices....

Persistent link: https://www.econbiz.de/10015210940

The Shift to Remote Work Lessens Wage-Growth Pressures

Barrero, Jose Maria; Bloom, Nicholas; Davis, Steven J.; … - 2022

The recent shift to remote work raised the amenity value of employment. As compensation adjusts to share the amenity-value gains with employers, wage-growth pressures moderate. We find empirical support for this mechanism in the wage-setting behavior of U.S. employers, and we develop novel...

Persistent link: https://www.econbiz.de/10013351924

Gains from Trade and the Food Engel Curve

Farrokhi, Farid; Jinkins, David; Xiang, Chong - 2022

This paper examines the extent to which gains-from-trade predictions from commonly-used trade theories are consistent with observed household consumption decisions. Our approach is based on inference from household-level estimation of food Engel curves in the US and in a few other countries. For...

Persistent link: https://www.econbiz.de/10013470437

Recession and Deflation?

Blanchflower, David G.; Bryson, Alex - 2022

Central bankers are raising interest rates on the assumption that wage-push inflation may lead to stagflation. This is not the case. Although unemployment is low, the labor market is not 'tight'. On the contrary, we show that what matters for wage growth are the non-employment rate and the...

Persistent link: https://www.econbiz.de/10013470458

The Price and Employment Response of Firms to the Introduction of Minimum Wages

Link, Sebastian - 2022

This paper studies the price and employment response of firms to the introduction of a nation-wide minimum wage in Germany. Widely throughout the economy, affected firms responded by rapidly and frequently increasing prices without cutting employment. These decisions are strongly interrelated:...

Persistent link: https://www.econbiz.de/10013470464

Welfare and Distributional Impact of Soaring Prices in Europe

Sologon, Denisa Maria; O'Donoghue, Cathal; Linden, Jules; … - 2022

This paper disentangles the distributional and welfare impact of price changes since the start of the cost of living crisis for a subset of European countries with different welfare regimes and price changes. It decomposes the impact of inflation and measures welfare changes using the...

Persistent link: https://www.econbiz.de/10013470501

Inflation Expectations and Misallocation of Resources: Evidence from Italy

Ropele, Tiziano; Gorodnichenko, Yuriy; Coibion, Olivier - 2023

Using Italian data that includes both inflation forecasts of firms and external information on their balance sheets, we study the causal effect of changes in the dispersion of beliefs about future inflation on the misallocation of resources. We find that as disagreement increases, so does...

Persistent link: https://www.econbiz.de/10014296850

A Theory of Non-Coasean Labor Markets

Blanco, Andrés; Drenik, Andres; Moser, Christian; … - 2023

We develop a theory of labor markets in a monetary economy with four realistic features: search frictions, worker productivity shocks, wage rigidity, and two-sided lack of commitment. Due to the non-Coasean nature of labor contracts, inefficient job separations occur in the form of endogenous...

Persistent link: https://www.econbiz.de/10014296865