New Keynesian Economics Most economists believe that short-run fluctuations in output and employment represent deviations from the natural rate, and that these deviations occur because wages and prices are sticky. New Keynesian research attempts to explain the stickiness of wages and prices by examining the microeconomics of price adjustment.• New Keynesian Economics • Most economists believe that short-run fluctuations in output and employment represent deviations from the natural rate, • and that these deviations occur because wages and prices are sticky. • New Keynesian research attempts to explain the stickiness of wages and prices by examining the microeconomics of price adjustment