Real Wages, Monetary Accommodation, and Inflation
AbstractWe analyze the dynamics of inflation in an economy characterized by a forward-looking, staggered, price and wage determination process, and by monetary accommodation. In our model, inflation reconciles the conflicting claims of workers and firms. The model is capable of generating a positive association between real wages and inflation, of the type that has been observed in some high-inflation countries. It generates a price-wage spiral but does not result in inflationary inertia.
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Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 3146.
Date of creation: Oct 1989
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Publication status: published as European Economic Review, Vol. 34, pp. 897-911, (1990).
Note: EFG ME
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