Stock market conditions and monetary policy in an DSGE model for the US

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Title: Stock market conditions and monetary policy in an DSGE model for the US
ISBN: 978-952-462-596-8
Author: Castelnuovo, Efrem ; Nisticò, Salvatore
Organization: Bank of Finland
Series: Bank of Finland Research Discussion Papers
ISSN: 1456-6184
Series year: 2010
Series number: 11/2010
Year of publication: 2010
Publication date: 5.4.2010
Published in: Published in Journal of Economic Dynamics and Control, Volume 34, Issue 9, September 2010: 1700-1731
Pages: 68 s.
Keywords: USA; rahapolitiikka; mallit; suhdanteet; osakemarkkinat; osakkeet; hinnat; varallisuus; rahoitusmarkkinat; DSGE
Abstract: We improve the precision of the test of the implicit contract model that Beaudry and DiNardo proposed twenty years ago. Our data set allows us to define the precise industry and plant of a particular employment relationship, link local labour market characteristics and company characteristics to the individual level of wages, and control for composition effects. We find evidence in favour of the spot market model of wage setting in the whole sample, but there is significant variation across industries and educational levels. In particular, the spot market matters most for low-skill workers, while the implicit contract model with one-sided limited commitment applies better to high-skill workers.
Note: Ilmestynyt myös Journal of Economic Dynamics and Control 2010 ; 34 ; 9.

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