Technology Shock and Employment under Catching up with the Joneses

Patrick Fève

Economics Bulletin, 2004, vol. 5, issue 3, 1-8

Abstract: Following a positive technology shock, a flexible price monetary model with catching up with the Joneses utility function can easily generate a negative and persistent decline in employment. When the effect of relative consumption is large, the model also produces a small short run response of output to a technology shock.

JEL-codes: E2 E3 (search for similar items in EconPapers)
Date: 2004-02-07
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