Rebalancing the euro area: Is wage adjustment in Germany the answer?
评估德国工资通胀政策能否促进欧元区及全球的经济再平衡，发现名义工资上涨短期推高通胀和产出，但利率持续期和货币政策预期影响效果大小。
We assess to what extent wage inflation policies in Germany could contribute to an economic rebalancing in the euro area and the rest of the world. We find that a rise in nominal wage inflation has positive short-run effects on inflation and output in Germany and the rest of the euro area. The duration of constant interest rates and expectations about the monetary policy stance matter to the magnitude of the results obtained. We establish that the modelling of the trade relationships with the rest of the world is of particular importance, as it allows to capture the induced relative price movements and hence changes in competitiveness within the three regions. Our results are obtained from an estimated DSGE model which consists of Germany, the rest of the euro area, and the rest of the world.