01643cas a2200241 a 4500 AALejournalIMF007349 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451854336 1018-5941 BD-DhAAL BD-DhAAL Jadresic, Esteban. Wage Indexation and Macroeconomic Stability : The Gray-Fischer Theorem Revisted / Esteban Jadresic. Washington, D.C. : International Monetary Fund, 1996. 1 online resource (24 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Since the seminal papers by Gray (1976) and Fischer (1977) were published, the major theorem of the wage indexation literature has been that indexing wages stabilizes output when shocks are nominal and destabilizes output when shocks are real. This paper reexamines the validity of this proposition taking into account the lags in actual indexation practices in an economy similar to that originally considered by those authors. It shows that in such a setup, wage contracts indexed to lagged inflation tend to destabilize output regardless of whether shocks are nominal or real. Mode of access: Internet IMF Working Papers; Working Paper ; No. 1996/121 Full text available on IMF http://elibrary.imf.org/view/journals/001/1996/121/001.1996.issue-121-en.xml IMF e-Library