Mancur Olson's Addendum to New Keynesianism
|Author(s):|| doc. PhDr. Martin Gregor Ph.D., |
|Type:||IES Working Papers|
|ISSN / ISBN:|
|Published in:||IES WP 2003/28|
|Grants:||IES Research Framework (1999-2004) "The Czech Economy in the Context of European Integration and Globalization"|
|Abstract:||The paper elaborates Mancur Olson's contribution to the understanding of nominal wage stickiness. Olson explains wage formation by collective action dilemmas faced by engaged parties. Nominal stickiness stems from bargaining costs and bargaining rules.
Secondly, the paper discusses compatibility of Olson's essentially microeconomic theory with disequilibrium Keynesianism. Olson himself wanted to enrich disequilibrium Keynesianism by his theory of interest groups, but his references to Clower are merely tentative. Though he termed his approach "evolutionary", I find it questionable into which framework it fits best -- evolutionary or Walrasian. His theory might be well subsumed into disequilibrium Keynesianism, although it has been developed within neoclassical framework.