This paper examines the role that wealth effects on labour supply play in a two-sector sticky-price model that includes non-durables and housing. Careful analysis of a two-sector sticky-price model reveals that whether there are wealth effects on labour supply fundamentally changes the nature of...

This paper investigates the role of manufacturing-specific and neutral technological changes in explaining the dramatic shift in hours worked from the manufacturing toward the service sector. The finding is that manufacturing-specific technological changes are the main contributor to the shift...