An Estimated New-Keynesian Model with Unemployment as Excess Supply of Labor

Miguel Casares, Antonio Moreno () and Jesús Vázquez

Documentos de Trabajo - Lan Gaiak Departamento de Economía - Universidad Pública de Navarra from Departamento de Economía - Universidad Pública de Navarra

Abstract: As one alternative to search frictions, wage stickiness is introduced in a New-Keynesian model to generate endogenous unemployment fluctuations due to mismatches between labor supply and labor demand. The effects on an estimated New-Keynesian model for the U.S. economy are: i) the Calvo-type probability on wage stickiness rises, ii) the labor supply elasticity falls, iii) the implied second-moment statistics of the unemployment rate provide a reasonable match with those observed in the data, and iv) wage-push shocks, demand shifts and monetary policy shocks are the three major determinants of unemployment fluctuations.

Keywords: sticky wages; unemployment; business cycles; New-Keynesian models. (search for similar items in EconPapers)
JEL-codes: C32 E30 (search for similar items in EconPapers)
Pages: pages
Date: 2010
New Economics Papers: this item is included in nep-cba, nep-lab and nep-mac
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Citations: View citations in EconPapers (5)

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Journal Article: An estimated New-Keynesian model with unemployment as excess supply of labor (2014)
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