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Unemployment and Wage Formation in a Growth Model with Public Capital

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  • Xavier Raurich
  • Valeri Sorolla

Abstract

We study the relation between public capital, employment and growth under different assumptions concerning wage formation. We show that public capital increases economic growth, and that, if there is wage inertia, employment positively depends on both economic growth and public capital.

Suggested Citation

  • Xavier Raurich & Valeri Sorolla, "undated". "Unemployment and Wage Formation in a Growth Model with Public Capital," UFAE and IAE Working Papers 508.02, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
    • Handle: RePEc:aub:autbar:508.02
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    References listed on IDEAS

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    1. Jean-Pierre Urbain & Franz Palm & David de la Croix, 2000. "Labor market dynamics when effort depends on wage growth comparisons," Empirical Economics, Springer, vol. 25(3), pages 393-419.
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    Citations

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    Cited by:

    1. Mattesini, Fabrizio & Rossi, Lorenza, 2009. "Optimal monetary policy in economies with dual labor markets," Journal of Economic Dynamics and Control, Elsevier, vol. 33(7), pages 1469-1489, July.
    2. Rossi, Lorenza & Mattesini, Fabrizio, 2007. "Productivity Shock and Optimal Monetary Policy in a Unionized Labor Market. Forthcoming: The Manchester School," MPRA Paper 8414, University Library of Munich, Germany, revised 2008.
    3. Ester Faia & Lorenza Rossi, 2013. "Union Power, Collective Bargaining, And Optimal Monetary Policy," Economic Inquiry, Western Economic Association International, vol. 51(1), pages 408-427, January.
    4. Lorenza Rossi & Fabrizio Mattesini, 2008. "We analyze, in this paper, a DSGE New Keynesian model with indi- visible labor where firms may belong to two different final goods producing sectors one where wages and employment are determined in co," DISCE - Quaderni dell'Istituto di Economia e Finanza ief0077, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
    5. Xavier Raurich & Valeri Sorolla, 2015. "A General Framework for Growth Models with Non-Competitive Labor and Product Markets and Disequilibrium Unemployment," Working Papers 369, Barcelona School of Economics.

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    Keywords

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    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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