Relative Wage Concern and the Keynesian Contract Multiplier

Guido Ascari () and J.A. Garcia

Economics Working Papers from European University Institute

Abstract: Recent quantitative dynamic general equilibrium models have cast serious doubts on the explanatory power of staggered wage/price setting in accounting for both output and inflation persistence. The authors enlarge a dynamic general equilibrium model with staggered wages by incorporating Keynesian relative wage concern on the part of workers.

Keywords: WAGES; EMPLOYMENT; BUSINESS CYCLES (search for similar items in EconPapers)
JEL-codes: E24 E32 (search for similar items in EconPapers)
Date: Written 1999
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Persistent link: http://EconPapers.repec.org/RePEc:eui:euiwps:eco99/5

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