Non-Walrasian Labor Markets and Real Business Cycles

Marco Maffezzoli ()

No 167, Working Papers from IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University

Abstract: The The standard Real Business Cycle literature mainly focuses on Walrasian models designed to fit the US institutional framework. Differences between the US and Europe, mostly evident in the labor market, suggest that a purely Walrasian model may be inappropriate to study European business cycles. We present a stochastic version of the dynamic general equilibrium model in Daveri and Maffezzoli (2000), where unemployment is generated by monopolistic unions, and calibrate it to reproduce several long-run features of the Italian and US economies. The properties of our model are compared to the corresponding ones of Rogerson and Wright's indivisible labor model. We focus on the standard business cycle statistics, the impulse response functions, and the ability to reproduce the cyclical components of the main macroeconomic variables. We conclude that: (i) the business cycle statistics are observationally equivalent in small samples; (ii) the impulse response functions of the Monopoly Union (MU) model show a higher degree of overall persistence; (iii) the MU model enjoys a statistically significative advantage in reproducing the Italian business cycles, while its alternative seems to better explain the US business cycles.

New Economics Papers: this item is included in nep-dge
References: Add references at CitEc
Citations: View citations in EconPapers (24)

Downloads: (external link)
https://repec.unibocconi.it/igier/igi/wp/2000/167.pdf (application/pdf)

Related works:
Journal Article: Non-Walrasian Labor Markets and Real Business Cycles (2001)
Working Paper: Non-Walrasian Labor Markets and Real Business Cycles (2000)
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:igi:igierp:167

Ordering information: This working paper can be ordered from
https://repec.unibocconi.it/igier/igi/

Access Statistics for this paper

More papers in Working Papers from IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University via Rontgen, 1 - 20136 Milano (Italy).
Bibliographic data for series maintained by ().