This file is part of IDEAS , which uses RePEc data
[ Papers |
Articles |
Software |
Books |
Chapters |
Authors |
Institutions |
JEL Classification |
NEP reports |
Search |
New papers by email |
Author registration |
Rankings |
Volunteers |
FAQ |
Blog |
Help! ]
Sticky wages and rule of thumb consumers Author info | Abstract | Publisher info | Download info | Related research | Statistics Andrea Colciago () (Department of Economics, University of Milan-Bicocca)
Additional information is available for the following
registered author(s):
I introduce sticky wages in the model with credit constrained or “rule of thumb” consumers advanced by Galì, Valles and Lopez Salido (2005). I show that wage stickiness i) restores, in contrast with the results in Bilbiie (2005), the Taylor Principle as a necessary condition for equilibrium determinacy; ii) implies that a a rise in consumption in response to an unexpected rise in government spending is not a robust feature of the model. In particular, consumption increses just when the elasticity of marginal disutility of labor supply is low. Results are robust to most of Taylor-type monetary rules used in the literature, including one which responds to wage inflation.
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page . Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
Paper provided by University of Milano-Bicocca, Department of Economics in its series Working Papers with number
98.
Download reference. The following formats are available: HTML
(with abstract ),
plain text
(with abstract ),
BibTeX ,
RIS (EndNote, RefMan, ProCite),
ReDIF
Length: 29 pages
Date of creation: Sep 2006Date of revision:
Sep 2006Handle: RePEc:mib:wpaper:98Contact details of provider: Postal: Edificio U6 (III Piano) - Piazza dell'Ateneo Nuovo, 1 - 20126 Milano Phone: 02/6448-6581/89 Fax: 02/6448-6585 Email: Web page: http://dipeco.economia.unimib.it More information through EDIRC
For technical questions regarding this item, or to correct its listing, contact: (Roberto Reale).
Keywords: Sticky Prices ; Sticky Wages ; Rule of Thumb Consumers ; Other versions of this item:
Find related papers by JEL classification: E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
This paper has been announced in the following NEP Reports :
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.: Ascari, G., 1997.
"Optimizing Agents, Staggered Wages and Persistence in the Real Effects of Money Shocks ,"
The Warwick Economics Research Paper Series (TWERPS)
486, University of Warwick, Department of Economics.
Other versions: Wolff, Edward N, 1998.
"Recent Trends in the Size Distribution of Household Wealth ,"
Journal of Economic Perspectives ,
American Economic Association, vol. 12(3), pages 131-50, Summer.
[Downloadable!] (restricted)
Galí, Jordi & López-Salido, J David & Vallés Liberal, Javier, 2005.
"Understanding the Effects of Government Spending on Consumption ,"
CEPR Discussion Papers
5212, C.E.P.R. Discussion Papers.
[Downloadable!] (restricted)
Other versions:
Jordi Galí & J.David López-Salidoz & Javier Vallés, 2004.
"Understanding the Effects of Government Spending on Consumption ,"
CFS Working Paper Series
2004/23, Center for Financial Studies.
[Downloadable!] Jordi Galí & J. David López-Salido & Javier Vallés, 2005.
"Understanding the Effects of Government Spending on Consumption ,"
NBER Working Papers
11578, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted) Jordi Galí & J. David López-Salido & Javier Vallés, 2002.
"Understanding the Effects of Government Spending on Consumption ,"
Economics Working Papers
911, Department of Economics and Business, Universitat Pompeu Fabra, revised Aug 2005.
[Downloadable!] Jordi Gali & David López-Salido & Javier Valles, 2004.
"Understanding the effects of government spending on consumption ,"
International Finance Discussion Papers
805, Board of Governors of the Federal Reserve System (U.S.).
[Downloadable!] Jordi Galí & J. David López-Salido & Javier Vallés, 2004.
"Understanding the effects of government spending on consumption ,"
Working Paper Series
339, European Central Bank.
[Downloadable!] Jordi Galí & J. David López-Salido & Javier Vallés, 2007.
"Understanding the Effects of Government Spending on Consumption ,"
Journal of the European Economic Association ,
MIT Press, vol. 5(1), pages 227-270, 03.
[Downloadable!] (restricted) Burnside, Craig & Eichenbaum, Martin & Fisher, Jonas D. M., 2004.
"Fiscal shocks and their consequences ,"
Journal of Economic Theory ,
Elsevier, vol. 115(1), pages 89-117, March.
[Downloadable!] (restricted)
Other versions: Baxter, Marianne & King, Robert G, 1993.
"Fiscal Policy in General Equilibrium ,"
American Economic Review ,
American Economic Association, vol. 83(3), pages 315-34, June.
[Downloadable!] (restricted)
Other versions: Schmitt-Grohé, Stephanie & Uribe, Martín, 2004.
"Optimal Simple and Implementable Monetary and Fiscal Rules ,"
CEPR Discussion Papers
4334, C.E.P.R. Discussion Papers.
[Downloadable!] (restricted)
Other versions: Fatas, Antonio & Mihov, Ilian, 2001.
"Government size and automatic stabilizers: international and intranational evidence ,"
Journal of International Economics ,
Elsevier, vol. 55(1), pages 3-28, October.
[Downloadable!] (restricted)
Other versions: Linnemann, Ludger & Schabert, Andreas, 2003.
" Fiscal Policy in the New Neoclassical Synthesis ,"
Journal of Money, Credit and Banking ,
Blackwell Publishing, vol. 35(6), pages 911-29, December.
Carlstrom, Charles T. & Fuerst, Timothy S., 2005.
"Investment and interest rate policy: a discrete time analysis ,"
Journal of Economic Theory ,
Elsevier, vol. 123(1), pages 4-20, July.
[Downloadable!] (restricted)
Other versions: Stephanie Schmitt-Grohe & Martin Uribe, 2004.
"Optimal Operational Monetary Policy in the Christiano-Eichenbaum-Evans Model of the U.S. Business Cycle ,"
NBER Working Papers
10724, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
Other versions: Olivier Blanchard & Roberto Perotti, 2002.
"An Empirical Characterization Of The Dynamic Effects Of Changes In Government Spending And Taxes On Output ,"
The Quarterly Journal of Economics ,
MIT Press, vol. 117(4), pages 1329-1368, November.
[Downloadable!] (restricted)
Other versions: N. Gregory Mankiw, 2000.
"The Savers-Spenders Theory of Fiscal Policy ,"
American Economic Review ,
American Economic Association, vol. 90(2), pages 120-125, May.
[Downloadable!] (restricted)
Other versions: Linnemann, Ludger, 2006.
"The Effect of Government Spending on Private Consumption: A Puzzle? ,"
Journal of Money, Credit and Banking ,
Blackwell Publishing, vol. 38(7), pages 1715-1735, October.
[Downloadable!] (restricted)
Florin Bilbiie, 2005.
"Limited Asset Markets Participation, Monetary Policy and (Inverted) Keynesian Logic ,"
Economics Papers
2005-W09, Economics Group, Nuffield College, University of Oxford.
[Downloadable!]
Erceg, Christopher J. & Henderson, Dale W. & Levin, Andrew T., 2000.
"Optimal monetary policy with staggered wage and price contracts ,"
Journal of Monetary Economics ,
Elsevier, vol. 46(2), pages 281-313, October.
[Downloadable!] (restricted)
Other versions: Galí, Jordi & Lopez-Salido, Jose David & Vallés Liberal, Javier, 2004.
"Rule-of-Thumb Consumers and the Design of Interest Rate Rules ,"
CEPR Discussion Papers
4347, C.E.P.R. Discussion Papers.
[Downloadable!] (restricted)
Other versions: Roland Straub & Günter Coenen, 2005.
"Non-Ricardian Households and Fiscal Policy in an Estimated DSGE Model of the Euro Area ,"
Computing in Economics and Finance 2005
102, Society for Computational Economics.
[Downloadable!]
Anton Muscatelli & Patrizio Tirelli & Carmine Trecroci, 2004.
"Can Fiscal Policy Help Macroeconomic Stabilisation? Evidence from a New Keynesian Model with Liquidity Constraints ,"
CESifo Working Paper Series
CESifo Working Paper No. , CESifo Group Munich.
[Downloadable!]
Amato, Jeffery D. & Laubach, Thomas, 2003.
"Rule-of-thumb behaviour and monetary policy ,"
European Economic Review ,
Elsevier, vol. 47(5), pages 791-831, October.
[Downloadable!] (restricted)
Guido Ascari & Tiziano Ropele, 2005.
"Trend Inflation, Taylor Principle and Indeterminacy ,"
Working Papers
93, University of Milano-Bicocca, Department of Economics, revised Oct 2005.
[Downloadable!]
Other versions: Lawrence J. Christiano & Martin Eichenbaum & Charles L. Evans, 2005.
"Nominal Rigidities and the Dynamic Effects of a Shock to Monetary Policy ,"
Journal of Political Economy ,
University of Chicago Press, vol. 113(1), pages 1-45, February.
Other versions:
Lawrence J. Christiano & Martin Eichenbaum & Charles Evans, 2001.
"Nominal Rigidities and the Dynamic Effects of a Shock to Monetary Policy ,"
NBER Working Papers
8403, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted) Lawrence J. Christiano & Martin Eichenbaum & Charles L. Evans, 2001.
"Nominal rigidities and the dynamic effects of a shock to monetary policy ,"
Working Paper Series
WP-01-08, Federal Reserve Bank of Chicago.
[Downloadable!] Lawrence J. Christiano & Martin Eichenbaum & Charles Evans, 2001.
"Nominal rigidities and the dynamic effects of a shock to monetary policy ,"
Working Paper
0107, Federal Reserve Bank of Cleveland.
[Downloadable!] Lawrence J. Christiano & Martin Eichenbaum & Charles Evans, 2001.
"Nominal rigidities and the dynamic effects of a shock to monetary policy ,"
Proceedings ,
Federal Reserve Bank of San Francisco, issue Jun.
[Downloadable!] Andrea Colciago & Anton Muscatelli & Tiziano Ropele & Patrizio Tirelli, 2006.
"The Role of Fiscal Policy in a Monetary Union: Are National Automatic Stabilizers Effective? ,"
CESifo Working Paper Series
CESifo Working Paper No. , CESifo Group Munich.
[Downloadable!]
Other versions:
Full
references Cited by : (explanations , Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.)
Lorenzo Forni & Libero Monteforte & Luca Sessa, 2007.
"The general equilibrium effects of fiscal policy: estimates for the euro area ,"
Temi di discussione (Economic working papers)
652, Bank of Italy, Economic Research Department.
[Downloadable!]
Other versions:
Access and
download statistics Did you know? All full texts are decentralized with the publishers, none reside on this server, thus making it possible to offer this service for free to all parties.
This page was last updated on 2009-12-6.
This information is provided to you by IDEAS at the Department of Economics , College of Liberal Arts and Sciences , University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics .