Type
Working paper
Titre
Wage Regimes, Accumulation and Finance Constraints : Keynesian Unemployment Revisited
Auteur(s)
SARACENO Francesco - (Auteur)
Collection
Documents de travail de l'OFCE : 2004-01
Mots clés
Disequilibrium, Keynesian economics, Fix Price Models
Résumé
EN
This paper presents a sequential model suited to analyze transitions between equilibria. Disequilibrium dynamics are obtained from a standard monopolistic competition model, by introducing a sequential structure and reasonable hypotheses about technology, finance constraints, expectation formation, and the wage setting mechanism. The response to shocks crucially depends on the institutional features of the economy, and on the monetary policy stance. In particular, some degree of wage stickiness proves necessary to avoid explosive paths. This feature of the model makes it a good candidate for the reappraisal of Keynes’ arguments on wages and unemployment.
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