Wage and price Phillips curve
| Authors | |
|---|---|
| Year of publication | 2004 |
| Type | Article in Proceedings |
| Conference | Mathematical Methods in Economics 2004 |
| MU Faculty or unit | |
| Citation | |
| Field | Economy |
| Keywords | Phillips curve; nominal rigidities; wage and price stickiness; microfoundations; optimizing-agent model |
| Description | This paper presents an optimizing-agent model in which both labor and product markets exhibit monopolistic competition. The wage and price equations are derived from optimizing behavior and thus depend on the underlying structure of preferences and technology. All model equations are log-linearised around steady state. Two types of shocks occur: shock to households preferences and technology shock. The implications of these shocks on adjustment process of main variables are examined. |
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