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

Miguel Casares, Antonio Moreno () and Jesús Vázquez Pérez

No 1988-088X, DFAEII Working Papers from University of the Basque Country - Department of Foundations of Economic Analysis II

Abstract: Wage stickiness is incorporated to a New-Keynesian model with variable capital to drive endogenous unemployment uctuations de ned as the log di¤erence between aggregate labor supply and aggregate labor demand. We estimated such model using Bayesian econometric techniques and quarterly U.S. data. The second-moment statistics of the unemployment rate in the model give a good t to those observed in U.S. data. Our results also show that wage-push shocks, demand shifts and monetary policy shocks are the three major determinants of unemployment fl uctuations. Compared to an estimated New-Keynesian model without unemployment (Smets and Wouters, 2007): wage stickiness is higher, labor supply elasticity is lower, the slope of the New-Keynesian Phillips curve is flatter, and the importance of technology innovations on output variability increases.

Keywords: sticky wages; unemployment; business cycles; New-Keynesian models. (search for similar items in EconPapers)
Date: 2012
New Economics Papers: this item is included in nep-lab and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://addi.ehu.eus/handle/10810/8761 (application/pdf)

Related works:
Journal Article: An estimated New-Keynesian model with unemployment as excess supply of labor (2014)
Working Paper: An Estimated New-Keynesian Model with Unemployment as Excess Supply of Labor (2012)
Working Paper: An Estimated New-Keynesian Model with Unemployment as Excess Supply of Labor (2010)
Working Paper: An Estimated New-Keynesian Model with Unemployment as Excess Supply of Labor (2010)
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: https://EconPapers.repec.org/RePEc:ehu:dfaeii:8761

Ordering information: This working paper can be ordered from
Dpto. de Fundamentos del Análisis Económico II, = Facultad de CC. Económicas y Empresariales, Universidad del País Vasco, Avda. Lehendakari Aguirre 83, 48015 Bilbao, Spain

Access Statistics for this paper

More papers in DFAEII Working Papers from University of the Basque Country - Department of Foundations of Economic Analysis II Contact information at EDIRC.
Bibliographic data for series maintained by Alcira Macías Redondo ().