A model with trade union rivalry is used to derive wage reaction functions, which are then estimated for skilled and unskilled men in Denmark. The results show substantial differences in wage determination between the two groups of workers in the short term, but once the wage-wage spiral starts...

The role of devaluation in stimulating profitability, investment, and ec onomic activity is studied in a model characterized by forward-lookin g investment behavior and wage contracts that provide an element of s hort-term nominal wage rigidity. The analysis shows that, in the case where the...