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Please use this identifier to cite or link to this item:
http://hdl.handle.net/10419/52418
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| Title: | | Matching labor's share in a search and matching model  |
| Authors: | | Reicher, Christopher Phillip |
| Issue Date: | | 2011 |
| Series/Report no.: | | Kiel Working Papers 1733 |
| Abstract: | | In the United States, labor’s share of income falls after a positive disturbance to productivity growth or inflation, and it remains low for some time. Previous researchers have argued that the negative relationship between productivity growth and labor’s share is puzzling. I argue otherwise. A search and matching model with infrequently bargained nominal wages would predict the observed behavior of labor’s share after a productivity disturbance, and it also predicts the observed behavior of labor’s share after an inflationary disturbance. Wages at the macroeconomic level seem to be sticky in a way which is consistent with microeconomic evidence; much of the ongoing discussion about the real effects of sticky wages seems to be well-motivated, while sticky price models fail to match the data. |
| Subjects: | | sticky wages sticky prices staggered Nash bargaining inflation productivity search and matching labor share |
| JEL: | | E24 E25 J23 J31 |
| Document Type: | | Working Paper |
| Appears in Collections: | | Publikationen von Forscherinnen und Forschern des IfW Kieler Arbeitspapiere, IfW
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