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Wendy Carlin, David Soskice

1990

3

Oxford: Oxford University Press

Macroeconomics and the Wage Bargain Page 1 Macroeconomics and the Wage Bargain A Modem Approach to Employment, Inflation, and the Exchange Rate Wendy Carlin and David Soskice Oxford University Press Page 2 Contents Introduction Inflation and Unemployment in Contemporary Economies PART I THE BACKGROUND: MACROECONOMICS WITH COMPETITIVE MICROFOUNDATIONS 15 1. The Classical Model of Employment and Inflation: MarketClearing and the Quantity Theory of Money 17 1.1 The Classical Model 18 1.2 Summarizing the Classical Model using Aggregate Demand and Supply 26 1.3 Conclusions and Policy Implications 28 2. Keynes's Model of Employment 29 2.1 Keynes's Model of Employment: IS/LM Analysis and Aggregate Demand and Supply 30 2.2 Keynes versus the Classics 47 2.3 Keynes's Model and Falling Money Wages 49 2.4 The Real Balance Effect: The Classical …