Skip to main content
Article
Information Content of Wages and Monetary Policy
Journal of Money, Credit, and Banking (2007)
  • Hans Gersbach, ETH Zurich
  • Volker Hahn, University of Konstanz
Abstract
We examine whether it is sufficient for central banks to observe and forecast nominal variables only. Analyzing the interplay of wage-setting unions and a central bank we show that although central banks may not gain more information by directly acquiring data about indicators of real shocks in the economy, such activities are nevertheless beneficial for central banks and yield lower social losses. Moreover, the extent of research activities by central banks should depend on the process of union formation.
Keywords
  • central banks,
  • wage bargaining,
  • information asymmetries,
  • indicators for monetary policy,
  • controlling inflation
Disciplines
Publication Date
2007
Citation Information
Hans Gersbach and Volker Hahn. "Information Content of Wages and Monetary Policy" Journal of Money, Credit, and Banking Vol. 33 Iss. 1 (2007)
Available at: http://works.bepress.com/volker_hahn/10/