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Effects of product and labor market regulation on macroeconomic outcomes

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  • Zanetti, Francesco

Abstract

This paper develops a New Keynesian model with labor search to investigate the effects of product and labor market regulation on macroeconomic outcomes. Product market regulation is proxied by the firm's price markup, and labor market regulation by the worker's bargaining power over the real wage. The results indicate that an increase in both types of regulation leads to a decline in macroeconomic fluctuations, and increases the importance of technology shocks in explaining movements in labor market tightness and employment.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Macroeconomics.

Volume (Year): 31 (2009)
Issue (Month): 2 (June)
Pages: 320-332

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Handle: RePEc:eee:jmacro:v:31:y:2009:i:2:p:320-332

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Web page: http://www.elsevier.com/locate/inca/622617

Related research

Keywords: Product market regulation Labor market regulation New Keynesian model Labor market search;

References

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Citations

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Cited by:
  1. Francesco Zanetti, 2014. "Labour Market and Monetary Policy Reforms in the UK: a Structural Interpretation of the Implications," Economics Series Working Papers 702, University of Oxford, Department of Economics.
  2. Gill Hammond, 2012. "State of the art of inflation targeting," Handbooks, Centre for Central Banking Studies, Bank of England, edition 4, number 29.

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