Inflation Persistence, Monetary Policy, and the Great Moderation

There is growing evidence that the empirical Phillips curve within the United States has changed significantly since the early 1980s. In particular, inflation persistence has declined sharply. This paper demonstrates that this decline is consistent with a standard dynamic New Keynesian (DNK) model in which: (i) the variability of technology shocks has declined and (ii) the central bank more aggressively responds to inflation. Copyright (c) 2009 The Ohio State University.

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Year of publication:	2009
Authors:	CARLSTROM, CHARLES T. ; FUERST, TIMOTHY S. ; PAUSTIAN, MATTHIAS
Published in:	Journal of Money, Credit and Banking. - Blackwell Publishing. - Vol. 41.2009, 4, p. 767-786
Publisher:	Blackwell Publishing

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Extent:	text/html
Type of publication:	Article
Source:	RePEc - Research Papers in Economics

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