We study differences in the adjustment of aggregate real wages in the manufacturing sectorover the business cycle across OECD countries, combining results from different data anddynamic methods. Summary measures of cyclicality show genuine cross-countryheterogeneity even after controlling for...

This chapter assesses how models with search frictions have shaped our understanding of aggregatelabor market outcomes in two contexts: business cycle fluctuations and long-run (trend) changes. Wefirst consolidate data on aggregate labor market outcomes for a large set of OECD countries. We...

Much recent research has focused on the development and analysis of extensions of the New Keynesianframework that model labor market frictions and unemployment explicitly. The present paper describessome of the essential ingredients and properties of those models, and their implications for...

This paper introduces staggered right-to-manage wage bargaining into a NewKeynesian business cycle model. Our key result is that the model is able to generatepersistent responses in output, inflation, and total labor input to both neutraltechnology and monetary policy shocks. Furthermore, we...

This study analyzes real wage cyclicality for male full-time workers within employer-employeematches in Germany over the period 1984-2004. Five different wage measures arecompared: the standard hourly wage rate; hourly wage earnings including overtime andbonus pay; the effective wage, which takes...

Payroll taxes represent a major distortionary influence of governments on labor markets. Thispaper examines the role of payroll taxation and the social safety net for cyclical fluctuations ina nonmonetary economy with labor market frictions and unemployment insurance, when thelatter is only...

This paper reviews recent approaches to modeling the labour market and assessestheir implications for in‡ation dynamics through both their e¤ect on marginalcost and on price-setting behaviour. In a search and matching environment, weconsider the following modeling setups: right-to-manage...

We estimate the effects of labor market entry conditions on wages for male individuals firstentering the Austrian labor market between 1978 and 2000. We find a large negative effect ofunfavorable entry conditions on starting wages as well as a sizeable negative long-run effect.Specifically, we...