The effects of technological innovations on employment: a new explanation

Chahnez Boudaya

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Abstract: This paper investigates principally the effects of a technological innovation on hours worked in a sticky price model. Our challenge is to reproduce the short-run decline in employment supported by a large range of recent works, inspired by Gali (1999), regardless of any monetary policy consideration. The model simulations concern the postwar U.S. economy under two different monetary policy: an exogenous rule targeting money supply and a simple Taylor rule. The most interesting result is that the introduction of an input-output production structure counterbalances the full-accommodation of a technological innovation when monetary policy is governed by a Taylor rule, by (i) providing the model with more price rigidities; (ii) inducing a substitution effect between intermediate goods and labor input for plausible values of intermediate inputs share.

Keywords: exogenous monetary policy; Taylor rule; intermediate inputs; labor; sticky prices; technology shocks; chocs technologiques; règle de Taylor; inputs intermédiaires; prix rigides; emploi; politique monétaire exogène (search for similar items in EconPapers)
Date: 2005-02
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00193600
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Published in 2005

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Related works:
Working Paper: The effects of technological innovations on employment: a new explanation (2005)
Working Paper: The effects of technological innovations on employment: a new explanation (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-00193600

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