IDEAS home Printed from https://ideas.repec.org/a/mes/postke/v29y2006i1p117-148.html
   My bibliography  Save this article

Aspirations, bargaining power, and macroeconomic performance

Author

Listed:
  • Mark Setterfield
  • Ted Lovejoy

Abstract

A model of aggregate wage and price setting is developed that nests competing hypotheses concerning the role of worker' aspirations and bargaining power in the wage bargain. It is shown that although aspirations and bargaining power always affect inflation in the short run, there is disagreement as to whether or not they influence macroeconomic performance in the long run. Empirical results suggest that a model in which aspirations and bargaining power affect the long-run rate of unemployment best fits the data and most accurately forecasts the rate of inflation. The implications of this result for the potential future performance of the U.S. economy and for macroeconomic policy are explored.

Suggested Citation

  • Mark Setterfield & Ted Lovejoy, 2006. "Aspirations, bargaining power, and macroeconomic performance," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 29(1), pages 117-148.
  • Handle: RePEc:mes:postke:v:29:y:2006:i:1:p:117-148
    DOI: 10.2753/PKE0160-3477290106
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.2753/PKE0160-3477290106
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Eckhard Hein & Achim Truger, 2011. "Fiscal Policy in the Macroeconomic Policy Mix: A Critique of the New Consensus Model and a Comparison of Macroeconomic Policies in France, Germany, the UK and Sweden from a Post-Keynesian Perspective," Chapters,in: Credit, Money and Macroeconomic Policy, chapter 12 Edward Elgar Publishing.
    2. Yun K. Kim & Mark Setterfield & Yuan Mei, 2014. "A theory of aggregate consumption," European Journal of Economics and Economic Policies: Intervention, Edward Elgar Publishing, vol. 11(1), pages 31-49, April.
    3. Eckhard Hein & Engelbert Stockhammer, 2010. "Macroeconomic Policy Mix, Employment and Inflation in a Post-Keynesian Alternative to the New Consensus Model," Review of Political Economy, Taylor & Francis Journals, vol. 22(3), pages 317-354.
    4. Yun K. Kim & Mark Setterfield & Yuan Mei, 2015. "Aggregate consumption and debt accumulation: an empirical examination of US household behaviour," Cambridge Journal of Economics, Oxford University Press, vol. 39(1), pages 93-112.
    5. Serrano, Franklin & Summa , Ricardo, 2015. "Distribution and Cost-Push inflation in Brazil under inflation targeting, 1999-2014," Centro Sraffa Working Papers CSWP14, Centro di Ricerche e Documentazione "Piero Sraffa".
    6. Mark Setterfield, 2017. "Modern (American) Capitalism: A Three Act Tragedy," Working Papers 1722, New School for Social Research, Department of Economics.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mes:postke:v:29:y:2006:i:1:p:117-148. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Chris Longhurst). General contact details of provider: http://www.tandfonline.com/MPKE20 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.