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Inflation and labor market dynamics revisited

  • Sveen, Tommy
  • Weinke, Lutz

We demonstrate that the presence of an empirically plausible labor adjustment decision at the firm level rationalizes strategic complementarities in price-setting which help explain inflation dynamics. Those strategic complementarities are typically assumed away in the related existing literature. This motivates our revisiting of inflation and labor market dynamics.

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Article provided by Elsevier in its journal Journal of Monetary Economics.

Volume (Year): 56 (2009)
Issue (Month): 8 (November)
Pages: 1096-1100

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Handle: RePEc:eee:moneco:v:56:y:2009:i:8:p:1096-1100
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505566

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