Score contribution per author:
α: calibrated so average coauthorship-adjusted count equals average raw count
This paper analyzes the macroeconomic impact of an oil discovery wh en there is sluggish adjustment of real rather than nominal wages. A recession (boom) will occur if the share of nontradable employment in total employment is s mall (large), if the share of nontradable consumption in total consumption is large (small) , and if the elasticity of nontradable employment, with respect to wages, is small (large) relative to that of employment in the tradables sector. The effect of the oil discovery on wage pressure is also shown to be crucial in determining the likelihood of a recession. Copyright 1988 by Royal Economic Society.