Notes for a New Guide to Keynes (I): Wages, Aggregate Demand, and Employment

Jordi Galí

No 18651, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: I revisit the General Theory's discussion of the role of wages in employment determination through the lens of the New Keynesian model. The analysis points to the key role played by the monetary policy rule in shaping the link between wages and employment, and in determining the welfare impact of enhanced wage flexibility. I show that the latter is not always welfare improving.

JEL-codes: E24 E32 E58 (search for similar items in EconPapers)
Date: 2012-12
New Economics Papers: this item is included in nep-mac
Note: EFG ME
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Published as NOTES FOR A NEW GUIDE TO KEYNES (I): WAGES, AGGREGATE DEMAND, AND EMPLOYMENT Jordi Gali Article first published online: 12 SEP 2013 DOI: 10.1111/jeea.12032 © 2013 by the European Economic Association Issue Journal of the European Economic Association Journal of the European Economic Association Volume 11, Issue 5, pages 973–1003, October 2013

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Related works:
Working Paper: Notes for a New Guide to Keynes (I): Wages, Aggregate Demand, and Employment (2015)
Journal Article: NOTES FOR A NEW GUIDE TO KEYNES (I): WAGES, AGGREGATE DEMAND, AND EMPLOYMENT (2013)
Working Paper: Notes for a New Guide to Keynes (I): Wages, Aggregate Demand, and Employment (2013)
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