.ation dynamics through both their effect on marginal cost and on price-setting behaviour. In a search and matching environment, we … volatile inflation. Models with wage stickiness and right-to-manage bargaining or with firm-specific labour emerge as the most … promising candidates. -- Inflation Dynamics ; Labour Market ; Business Cycle ; Real Rigidities …

general equilibrium model that integrates a theory of equilibrium unemployment into a monetary model with nominal price … helps to explain the sluggishness of inflation and the persistence of output after a monetary policy shock. The ability of …In order to explain the joint fluctuations of output, inflation and the labor market, this paper first develops a …

period. The workers' bargaining power in the hours negotiation affects both unemployment volatility and inflation persistence … the new entrants wage rigidity required to match observed unemployment volatility. -- DSGE ; Search and Matching ; Nominal …We consider a model with frictional unemployment and staggered wage bargaining where hours worked are negotiated every …

degree of wage rigidity makes monetary policy more effective, i.e. a monetary policy shock transmits faster onto inflation … which labor markets are characterized by search and matching frictions. We first investigate to which extent a more flexible … fluctuations. Our results point primarily towards disturbances in the bargaining process as a significant contributor to inflation …

This paper investigates the importance of labor market institutions for inflation and unemployment dynamics. Using the … and their interaction is crucial for the dynamics of inflation and unemployment. We estimate a panel VAR with … deterministically varying coeficients and find that there is a profound difference in the responses of unemployment and inflation to …

an estimated DSGE model. It finds that the disconnect is due primarily to the muted reaction of inflation to cost … inflation stabilization also appears to have played some role by reducing the impact of demand shocks on the real economy. The …

persistent movements of aggregate inflation. Moreover, the impact of a monetary policy shock on unemployment and inflation … employment and hours affecting inflation dynamics via marginal costs. We find that the response of unemployment and inflation to …In this paper we incorporate a labor market with matching frictions and wage rigidities into the New Keynesian business …

-run Phillips curve between inflation and unemployment and a trade-off between price distortions and output hysteresis that change …Standard New Keynesian (NK) models feature an optimal inflation target well below two percent, limited welfare losses … the welfare-maximizing inflation level. For a plausible set of parameters, the optimal inflation target is in excess of …