Optimal contracts and the role of the government in wage bargaining

Lilia Cavallari

Economics Letters, 2012, vol. 115, issue 2, 160-163

Abstract: This paper introduces a contract between the government and trade unions in a model of strategic wage bargaining à la Lippi (2003). It shows that an optimal contract can be implemented through an appropriately defined inflation target.

Keywords: Fiscal policy commitment; Optimal wage contract; Wage bargaining; Social pact; Inflation target (search for similar items in EconPapers)
JEL-codes: E64 J51 (search for similar items in EconPapers)
Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:115:y:2012:i:2:p:160-163

DOI: 10.1016/j.econlet.2011.12.016

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