Kryvtsov, Oleksiy; Midrigan, Virgiliu - In: Review of Economic Studies 80 (2013) 1, pp. 249-276
A growing consensus in New Keynesian macroeconomics is that nominal cost rigidities, rather than countercyclical markups, account for the bulk of the real effects of monetary policy shocks. We revisit these conclusions using theory and data on inventories. We study an economy with nominal...