Cyclical Movements in Hours and Effort Under Sticky Wages

Mark Joseph Bils and Yongsung Chang ()

International Economic Journal, 2001, vol. 15, issue 2, pages 1-26

Abstract: We examine the response of a sticky-wage economy to various real and nominal shocks. In addition to variations in hours, we allow for an endogenous response in worker effort per hour. Despite wages being predetermined, the labor market clears through the effort margin. We find that the ability of a sticky-wage model to mimic U.S. business cycles is much improved by allowing for reasonable effort movements. The model also provides a ready explanation for the finding that TFP is negatively affected by nominal shocks. [E24]

Date: 2001
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
http://www.tandfonline.com/doi/abs/10.1080/10168730100000033 (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Cyclical Movements in Hours and Effort under Sticky Wages (2002)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:taf:intecj:v:15:y:2001:i:2:p:1-26

Ordering information: This journal article can be ordered from
http://www.tandf.co.uk/journals/subscription.asp

Access Statistics for this article

International Economic Journal is edited by Jaymin Lee

More articles in International Economic Journal from Korean International Economic Association
Series data maintained by Michael McNulty ().