Understanding the Gains from Wage Flexibility: The Exchange Rate Connection

We study the gains from increased wage flexibility using a small open economy model with staggered price and wage setting. Two results stand out: (i) the effectiveness of labor cost reductions as a means to stimulate employment is much smaller in a currency union, and (ii) an increase in wage flexib...

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Bibliographic details
Volume: 106
Main Author: Gali, Jordi
Monacelli, Tommaso
Format: Journal Article
Language: English
Zielgruppe: Academic
Place of publication: NASHVILLE American Economic Association 01.12.2016
AMER ECONOMIC ASSOC
published in: The American economic review Vol. 106; no. 12; pp. 3829 - 3868
ORCID: 0000-0003-4950-7462
Data of publication: 20161201
ISSN: 0002-8282
1944-7981
EISSN: 1944-7981
Discipline: Economics
Law
Subjects:
Online Access: Fulltext
Database: Web of Knowledge
Social Sciences Citation Index
Web of Science
Web of Science - Social Sciences Citation Index - 2016
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