We introduce nominal wage contracts into a competitive and a noncompetitive labor market structure. We find these models to have similar business cycle properties, but we argue that the imperfectly competitive market structure is more appropriate for nominal wage contract analyzes. We introduce...

In this paper, I re-examined standard preferences in a small open economy (SOE) model with indivisible labor calibrated to Canada. It is well known that dynamic small open economy models rely on Greenwood, Hercowitz and Huffman (1988) preferences to match the countercyclical trade balance...

Calvo nominal rigidities are well known to enhance the monetary transmission mechanism in dynamic stochastic general equilibrium (DSGE) models. However, this class of models gives rise to certain anomalies, including excessively high volatilities and countercyclical productivity. In addition,...