Wage contracts, capital mobility, and macroeconomic policy

Article Abstract:

The impacts of macroeconomic policy shocks on output, real wages, real exchange rate and current account were assessed through consideration of imperfect capital mobility and nominal wage rigidity. Through the use of intertemporal optimizing model, the process in which wage contracts are formulated is unaffected by a decreased non-traded good spending. The steady-state output in the export industry with backward- and forward-looking contracts decreases when a cut in nominal devaluation rate is undertaken.

Analysis, Economic policy, Capital movements

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The aggregate existence of precautionary saving: time-series evidence from expenditures on nondurable and durable goods

Article Abstract:

A test was formulated to evaluate the importance of precautionary saving on aggregate wealth. The test, which was devised through the use of time-series data, takes into consideration expenditures made on durable and nondurable goods and services. The approach revealed significant evidence suggesting the existence of precautionary saving and the significance of such saving in aggregate wealth accumulation.

Consumption (Economics)

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