文档介绍：CHAPTER THIRTEEN
Aggregate Supply
Learning objectives
three models of aggregate supply in which output depends positively on the price level in the short run
the short-run tradeoff between inflation and unemployment known as the Phillips curve
1
Three models of aggregate supply
The sticky-wage model
The imperfect-information model
The sticky-price model
All three models imply:
natural rate of output
a positive parameter
the expected price level
the actual price level
agg. output
2
The sticky-wage model
Assumes that firms and workers negotiate contracts and fix the nominal wage before they know what the price level will turn out to be.
The nominal wage, W, they set is the product of a target real wage, , and the expected price level:
3
The sticky-wage model
If it turns out that
then
unemployment and output are at their natural rates
Real wage is less than its target, so firms hire more workers and output rises above its natural rate
Real wage exceeds its target, so firms hire fewer workers and output falls below its natural rate
4
5
The sticky-wage model
Implies that the real wage should be counter-cyclical , it should move in the opposite direction as output over the course of business cycles:
In booms, when P typically rises, the real wage should fall.
In recessions, when P typically falls, the real wage should rise.
This prediction does e true in the real world:
6
The cyclical behavior of the real wage
Percentage
change in real
wage
Percentage change in real GDP
1982
1975
1993
1992
1960
1996
1999
1997
1998
1979
1970
1980
1991
1974
1990
1984
2000
1972
1965
-3
-2
-1
0
1
2
3
7
8
6
5
4
4
3
2
1
0
-1
-2
-3
-4
-5
7
The imperfect-information model
Assumptions:
all wages and prices perfectly flexible, all markets clear
each supplier produces one good, consumes many goods
each supplier knows the nominal price of the good she produces, but does not know the overall price level
8
The imperfect-i