Sticky-Wage Models and Knowledge Capital: A Note

Kevin Huang (), Munechika Katayama, Mototsugu Shintani and Takayuki Tsuruga

No 17-00006, Vanderbilt University Department of Economics Working Papers from Vanderbilt University Department of Economics

Abstract: We present a sticky-wage model with two types of labors: while a worker's labor contributes to current production, a researcher's work helps develop new ideas to add to a firm's knowledge capital that enhances its productivity for many periods. The long-lived effect of knowledge capital on productivity is analogous to the long-lasting effect of consumer durables on utility in the sticky-price model of Barsky, House and Kimball (2007). We show, however, that the relative role of the pricing of the two production inputs analogous to consumption durables and nondurables in BHK's sticky-price model is completely switched in our sticky-wage model.

JEL-codes: C0 E0 (search for similar items in EconPapers)
Date: 2017-04-22
New Economics Papers: this item is included in nep-knm and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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