.S. price level and inflation are much more responsive to aggregate technology shocks than to monetary policy shocks. The model … affect the incentives faced by firms in allocating attention. A policy rate responding more actively to expected inflation …

knowledge sector is bounded, as productivity increases, the economy moves from a "Solovian zone" where wages increase with … productivity, to a "Marxian" zone where the paradoxically decline with productivity. This is because as consumption of a given good … more unevenly distributed then productivity, technical progress always increases inequality. Redistribution from profits to …