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Unions, monetary shocks and the labour market cycle

  • Fernández-de-Córdoba, Gonzalo
  • Vázquez, Jesús

This paper provides a new growth model by considering strategic behaviour in the supply of labour. Workers form a labour union with the aim of manipulating wages for their own benefit. We analyse the implications on labour market dynamics at business cycle frequencies of getting away from the price-taking assumption. A calibrated monetary version of the union model does quite a reasonable job in replicating the dynamic features of labour market variables observed in post-war U.S. data.

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Article provided by Elsevier in its journal Economic Modelling.

Volume (Year): 28 (2011)
Issue (Month): 3 (May)
Pages: 1140-1149

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Handle: RePEc:eee:ecmode:v:28:y:2011:i:3:p:1140-1149
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