What happens to the labor demand schedule

Reference no: EM132118792

Question: A permanent TFP shock: Now consider a TFP shock that is permanent. For example, suppose the discovery and application of a new technology makes firms more productive. Consider the labor market block of a standard DSGE model with no sticky prices or wages.

(a) What happens to the labor demand schedule?

(b) What happens to the labor supply schedule?

Reference no: EM132118792

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