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The Economics of Price Scissors
Sah, Raaj Kumar; Stiglitz, Joseph E. - 2021
We analyze consequences of changing the terms of trade between agriculture and industry on capital accumulation and on welfare of workers in different sectors. The issue was central to Soviet industrialization debate and it remains important in today's developing world. Through a simple general...
Persistent link: https://www.econbiz.de/10013214620
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Price Level Determinacy with an Interest Rate Policy Rule and Rational Expectations
McCallum, Bennett T. - 2021
This paper reconsiders a result obtained by Sargent and Wallace, namely, that price level indeterminacy obtains in their well-known model if the monetary authorities adopt a policy feedback rule for the interest rate rather than the money stock. Since the Federal Reserve seems often to have used...
Persistent link: https://www.econbiz.de/10013219724
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Money, Interest and Prices
Fischer, Stanley - 2021
Twenty five years after the publication of the second edition, this paper describes and evaluates the Contributions to monetary and macroeconomics made in Don Patinkin's Money, Interest, and Prices (MIP). Its first accomplishment was to settle definitively many issues, such as the valid and...
Persistent link: https://www.econbiz.de/10013230788
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Optimal Wage Indexation, Foreign-Exchange Intervention and Monetary Policy
Aizenman, Joshua - 2010
which affect the economy and by the information set that individuals possess. Because of cost of negotiations, nominal wages …
Persistent link: https://www.econbiz.de/10012760345
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Real Balances, the Exchange Rate and Indexation : Real Variables in Disinflation
Fischer, Stanley - 2021
ante wage indexation speeds up disinflation. With expost indexation the real wage automatically rises when the inflation …
Persistent link: https://www.econbiz.de/10013248714
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Wage Indexation and Exchange Market Intervention in a Small Open Economy
Turnovsky, Stephen J. - 2021
The analysis of this paper stresses the interdependence between wage indexation on the one hand, and exchange market intervention on the other,as tools of'macroeconomic stabilization policy in a small open economy subject to stochastic disturbances. It is shown how the choice of eitherpolicy...
Persistent link: https://www.econbiz.de/10013212914
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Supply Shocks, Wage Indexation and Monetary Accommodation
Aizenman, Joshua; Frenkel, Jacob A. - 2021
implications of indexing wages to (i) nominal GNP, (ii) the CPI and (iii) the value-added price index, as well as the implications … stabilize the real wage. In that case, indexing wages to nominal GNP results in a smaller welfare cost than indexing to value …
Persistent link: https://www.econbiz.de/10013313305
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Cost-of-Living Adjustment Clauses in Union Contracts
Ehrenberg, Ronald G.; Danziger, Leif; San, Gee - 2021
Our paper seeks to provide an explanation for why the prevalence of COLA provisions and their characteristics vary widely across U.S. industries. We develop models of optimal risk sharing between a firm and union that allows us to investigate the determinants of a number of characteristics of...
Persistent link: https://www.econbiz.de/10013237296
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Wage Indexation and Time-Consistent Monetary Policy
Ball, Laurence; Cecchetti, Stephen G. - 2021
This paper investigates the effects of wage indexation on the time-consistent level of inflation. Departing from … previous work on time-consistent policy, we study a structural model of the economy. Indexation reduces the cost of inflation … raise inflation but also to raise welfare: the loss from higher inflation is outweighed by the gain from greater protection …
Persistent link: https://www.econbiz.de/10013218529
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Labor Market Shifts and the Price Puzzle Revisited
Krueger, Alan B. - 2021
-Samuelson theory of expanded trade with countries that are abundant in less-skilled workers, as well as with some models of …
Persistent link: https://www.econbiz.de/10013213070