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Title: |
Interest Rates and Wage Indexation |
| Author: |
Rhee, Wookwan |
| Author
Affiliation: |
Korea Econ Res
Inst |
| Source: |
International Economic Journal, Summer 1988, v. 2, no. 2, pp. 63-73 |
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Publication Date: |
Summer 1988 |
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Abstract: |
This paper shows that if wages are indexed
to interest rate and price level in a certain combination the effect of
monetary disturbances can be removed. Further, it is shown that the
indexation coefficients can be optimally chosen so that the effect of
real disturbances on output is minimized. Another interesting result is
that the determination of output is not affected by the choice of
monetary policy when wage indexation utilizes both prices and interest
rates. |
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