persistent budget deficits and inflation. The paper also provides a rigorous analysis of household savings and money demand in a …

degree of wage indexation is effective in lowering inflation if nominal wages do not provide, on average, full protection … behavior, the fiscal deficit, inflation and the capital stock. Wage controls have been widely advocated as a response to the … capital decumulation and reduce inflation, since wage moderation implies higher government revenues from the profit tax and …

relates average unemployment to average wage inflation; the curve is virtually vertical for high inflation rates but becomes … flatter as inflation declines. Second, macroeconomic volatility shifts the Phillips curve outward, implying that stabilization … policies can play an important role in shaping the trade-off. Third, nominal wages tend to be endogenously rigid also upward …

.2 percent to 7.8 percent. A fixed wage or indexation to consumption price inflation increases volatility most. Indexation to … wage inflation or unit labor cost growth is preferable, largely preserving labor market flexibility. …

We develop a model which shows that wages, prices and real income should grow faster in countries with low increase in … increase in their prices and in German wages. This mechanism is magnified by the low price elasticity of the demand for German …