@TechReport{iza:izadps:dp2521,
            	author={Bodart, Vincent and Pierrard, Olivier and Sneessens, Henri R.},
            	title={Calvo Wages in a Search Unemployment Model},
            	year={2006},
	month={Dec},
            	institution={Institute of Labor Economics (IZA)},
            	address={Bonn},
            	type={IZA Discussion Paper},
            	number={2521},
            	url={https://www.iza.org/publications/dp2521},
	abstract={RBC models with search unemployment and wage renegotiation generate too much wage volatility and too stable unemployment rate. Shimer (2004) shows that it is possible to reproduce a volatility of unemployment similar to that observed in actual economies by imposing full real wage rigidity. We use a similar model but with Calvo wage contracts and we obtain a microfounded equation of real wage rigidities. The models with full wage flexibility or full wage rigidity are obtained as particular cases. We show that a contract length of about six quarters fits best the observed cyclical properties of wages and unemployment.},
	keywords={search unemployment;Calvo wage;cyclical properties},
            }