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Working Paper

Magnification Effects and Acyclical Real Wages

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An analysis of a one-period, two-sector model in which firms must pay a fixed cost of hiring. The authors show that this type of model results in more employment variability and less-procyclical wages than do models without fixed hiring costs.
04.01.1991ISSN 2573-7953 WP 91-05DOI 10.26509/frbc-wp-199105

Working Papers of the Federal Reserve Bank of Cleveland are preliminary materials circulated to stimulate discussion and critical comment on research in progress. They may not have been subject to the formal editorial review accorded official Federal Reserve Bank of Cleveland publications. The views expressed in this paper are those of the authors and do not represent the views of the Federal Reserve Bank of Cleveland or the Federal Reserve System.

Suggested Citation

Carlstrom, Charles T., and Edward Gamber. 1991. “Magnification Effects and Acyclical Real Wages.” Federal Reserve Bank of Cleveland, Working Paper No. 91-05. https://doi.org/10.26509/frbc-wp-199105