The effects of technological innovations on employment: a new explanation

Chahnez Boudaya

Cahiers de la Maison des Sciences Economiques from Université Panthéon-Sorbonne (Paris 1)

Abstract: This paper investigates principally the effects of a technological innovation on hours worked in a sticky price model. Our challenge is to reproduce the short-run decline in employment supported by a large range of recent works, inspired by Gali (1999), regardless of any monetary policy consideration. The model simulations concern the post war U.S. economy under two different monetary policies: an exogenous rule targeting money supply and a simple Taylor rule. The most interesting result is that the introduction of an input-output production structure counterbalances the full-accommodation of a technological innovation when monetary policy is governed by a Taylor rule, by (i) providing the model with more price rigidities; (ii) inducing a substitution effect between intermediate goods and labor input for plausible values of intermediate inputs share

Keywords: Technology shocks; sticky prices; labor; intermediate inputs; Taylor rule; exogenous monetary policy (search for similar items in EconPapers)
JEL-codes: E23 E24 E31 E32 E52 (search for similar items in EconPapers)
Pages: 44 pages
Date: 2005-02
New Economics Papers: this item is included in nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: The effects of technological innovations on employment: a new explanation (2005)
Working Paper: The effects of technological innovations on employment: a new explanation (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:mse:wpsorb:v05013

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