Labor Markets and Monetary Policy: A New Keynesian Model with Unemployment

We construct a utility-based model of fluctuations with nominal rigidities and unemployment. We first show that under a standard utility specification, productivity shocks have no effect on unemployment in the constrained efficient allocation. That property is also shown to hold, despite labor marke...

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Bibliographic Details
Published in:American Economic Journal: Macroeconomics, Vol. 2, No. 2 (2010), p. 1-30
Main Author: Blanchard, Olivier
Other Involved Persons: Galí, Jordi
Format: electronic Article
Item Description:Copyright: Copyright © 2010 American Economic Association
Physical Description:Online-Ressource
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