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Author: Jonathan Michie Publisher: Bloomsbury Publishing ISBN: 147250819X Category : Business & Economics Languages : en Pages : 209
Book Description
During prolonged economic recessions when the normal cyclical expansion of output fails to materialize, the topic of the 'cyclical behaviour of wages' has emerged as an area of debate. In 1985, the British Treasury claimed that academic studies into the cyclical behaviour of wages demonstrated that a cut in wages would increase employment. Wages in the Business Cycle contests this argument by presenting the results of original, empirical work which illustrates the absence of any systematic empirical regularity to wage movements over the business cycle. Jonathan Michie argues that the re-emergence of this debate must be seen within the context of the theory of the 'labour demand function', representing an attempt to challenge the Keynesian theoretical assumptions implicit in the bulk of applied macro economic work up to the late 1970s.
Author: Jonathan Michie Publisher: Bloomsbury Publishing ISBN: 147250819X Category : Business & Economics Languages : en Pages : 209
Book Description
During prolonged economic recessions when the normal cyclical expansion of output fails to materialize, the topic of the 'cyclical behaviour of wages' has emerged as an area of debate. In 1985, the British Treasury claimed that academic studies into the cyclical behaviour of wages demonstrated that a cut in wages would increase employment. Wages in the Business Cycle contests this argument by presenting the results of original, empirical work which illustrates the absence of any systematic empirical regularity to wage movements over the business cycle. Jonathan Michie argues that the re-emergence of this debate must be seen within the context of the theory of the 'labour demand function', representing an attempt to challenge the Keynesian theoretical assumptions implicit in the bulk of applied macro economic work up to the late 1970s.
Author: Robert Shimer Publisher: Princeton University Press ISBN: 1400835232 Category : Business & Economics Languages : en Pages : 189
Book Description
Labor Markets and Business Cycles integrates search and matching theory with the neoclassical growth model to better understand labor market outcomes. Robert Shimer shows analytically and quantitatively that rigid wages are important for explaining the volatile behavior of the unemployment rate in business cycles. The book focuses on the labor wedge that arises when the marginal rate of substitution between consumption and leisure does not equal the marginal product of labor. According to competitive models of the labor market, the labor wedge should be constant and equal to the labor income tax rate. But in U.S. data, the wedge is strongly countercyclical, making it seem as if recessions are periods when workers are dissuaded from working and firms are dissuaded from hiring because of an increase in the labor income tax rate. When job searches are time consuming and wages are flexible, search frictions--the cost of a job search--act like labor adjustment costs, further exacerbating inconsistencies between the competitive model and data. The book shows that wage rigidities can reconcile the search model with the data, providing a quantitatively more accurate depiction of labor markets, consumption, and investment dynamics. Developing detailed search and matching models, Labor Markets and Business Cycles will be the main reference for those interested in the intersection of labor market dynamics and business cycle research.
Author: Haoming Liu Publisher: London : Department of Economics, University of Western Ontario ISBN: Category : Business & Economics Languages : en Pages : 52
Author: Ulrich Woitek Publisher: ISBN: Category : Reallohn / Konjunktur / VAR-Modell / Schätzung / Vergleich / USA / Deutschland Languages : en Pages : 23
Book Description
The cyclicality of real wages has important implications for the validity of competing business cycle theories. However, the empirical evidence on the aggregate level is inconclusive. Using a threshold vector autoregressive model for the US and Germany to condition the relationship between real wages and business fluctuations on the phase of the cycle, it is demonstrated that the inconclusive evidence is not only caused by measurement problems, estimation method and composition bias as discussed in the literature. In addition, one should also consider whether the economy is in an upswing or a downswing. In general, the evidence for countercyclical wages is stronger in Germany than for the US, but taken together there is no clear systematic pattern.
Author: Ms.Valerie Cerra Publisher: International Monetary Fund ISBN: 1513536990 Category : Business & Economics Languages : en Pages : 50
Book Description
Traditionally, economic growth and business cycles have been treated independently. However, the dependence of GDP levels on its history of shocks, what economists refer to as “hysteresis,” argues for unifying the analysis of growth and cycles. In this paper, we review the recent empirical and theoretical literature that motivate this paradigm shift. The renewed interest in hysteresis has been sparked by the persistence of the Global Financial Crisis and fears of a slow recovery from the Covid-19 crisis. The findings of the recent literature have far-reaching conceptual and policy implications. In recessions, monetary and fiscal policies need to be more active to avoid the permanent scars of a downturn. And in good times, running a high-pressure economy could have permanent positive effects.
Author: Jonathan Michie
Author: Jonathan Michie
Author: Robert B. Barsky
Author: Robert Shimer
Author: Haoming Liu
Author: 
Author: Michael P. Keane
Author: Ulrich Woitek
Author: Charles A. Fleishman
Author: 
Author: Ms.Valerie Cerra