Understanding the gains from wage flexibility: the exchange rate connection
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- dc.contributor.author Galí, Jordi, 1961-ca
- dc.contributor.author Monacelli, Tommasoca
- dc.contributor.other Universitat Pompeu Fabra. Departament d'Economia i Empresaca
- dc.date.issued 2013-12-01ca
- dc.date.modified 2016-09-29T02:50:41Zca
- dc.description.abstract We study the gains from increased wage flexibility using a small open economy model with staggered price and wage setting. Two results stand out: (i) the effectiveness of labor cost reductions as a means to stimulate employment is much smaller in a currency union, and (ii) an increase in wage flexibility often reduces welfare, more likely so in an economy that is part of a currency union or with an exchange-rate-focused monetary policy. Our findings call into question the common view that wage flexibility is particularly desirable in a currency union.en
- dc.format.mimetype application/pdfca
- dc.identifier https://econ-papers.upf.edu/ca/paper.php?id=1408ca
- dc.identifier.uri http://hdl.handle.net/10230/21807ca
- dc.language.iso engca
- dc.relation.ispartofseries Economics and Business Working Papers Series; 1408ca
- dc.rights L'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative Commonsca
- dc.rights.accessRights info:eu-repo/semantics/openAccessca
- dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/ca
- dc.subject.keyword Macroeconomics and International Economicsca
- dc.subject.keyword sticky wagesca
- dc.subject.keyword nominal rigiditiesca
- dc.subject.keyword new keynesian modelca
- dc.subject.keyword stabilization policiesca
- dc.subject.keyword exchange rate policyca
- dc.subject.keyword currency unionsca
- dc.subject.keyword monetary policy rules.ca
- dc.title Understanding the gains from wage flexibility: the exchange rate connectionca
- dc.type info:eu-repo/semantics/workingPaperca