Driver, Ciaran and Hall, Stephen G. (2008) 'Production Constraints and the NAIRU.' Economics: the open-access, open-assessment e-journal, 2.
Available under License Creative Commons Attribution Non-commercial.
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This paper argues that the production constraints in the basic NAIRU model should be distinguished by type: capital constraints and labour constraints. It notes the failure to incorporate this phenomenon in standard macro models. Using panel data for UK manufacturing over 80 quarters we show that capital constraints became relatively more important during the 1980s as industry failed to match the increase in labour flexibility with rising capital investment.
|Item Type:||Journal Articles|
|SOAS Departments & Centres:||Faculty of Law and Social Sciences > School of Finance and Management|
|DOI (Digital Object Identifier):||10.5018/economics-ejournal.ja.2008-11|
|Depositing User:||Mutsa Marau|
|Date Deposited:||22 Oct 2010 10:50|
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