adjustment costs and indivisibility of labor in the employment stickiness of manufacturing firms with less than 75 employees …. When small firms have to adjust employment in units of at least one employee, indivisibility becomes an important source of … explains around 50% of the stickiness of employment, adjustment costs explain the other 50%. …

satisfy demand in the short run by adjusting hours per worker. Imperfect product market competition and search frictions … reduce steady state hours per worker below the efficient level. Bargaining results in a convex ‘wage curve’ linking wages to … hours. Since the steady-state real marginal wage is low, wages respond little to hours. As a result, firms overuse the hours …

We consider a model with frictional unemployment and staggered wage bargaining where hours worked are negotiated every … period. The workers’ bargaining power in the hours negotiation affects both unemployment volatility and inflation persistence …. The closer to zero this parameter, (i) the more firms adjust on the intensive margin, reducing employment volatility, (ii …

Phillips curve is that inflation is not only driven by an output gap but also by an employment gap – a feature usually …

This paper analyses the real-time forecasting performance of the New Keynesian DSGE model of Galí, Smets, and Wouters … forecasts implied by the DSGE model. Under the “news” approach, it is assumed that the forecasts reveal the presence of expected … future structural shocks in line with those estimated over the past. The forecasts of the DSGE model are compared with those …