We use a computable general equilibrium model incorporating trade unions, efficient Nash contracts, existing distortions, and international trade to measure the deadweight loss in Canada arising from the ability of unions to raise wages above competitive levels. The model incorporates two...

This paper studies, in a model of entry deterrence, conditions under which a small cost of changing nominal prices combined with a real rigidity leads to a large nominal rigidity. The entry deterrence environment, which generates the real rigidity, provides an appealing explanation as to why...