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Inflation dynamics with labour market matching: assessing alternative specifications

Christoffel, Kai; Costain, James S.; De Walque, Gregory; … - European Central Bank - 2009

This paper reviews recent approaches to modeling the labour market and assessestheir implications for ination dynamics through both their e¤ect on marginalcost and on price-setting behaviour. In a search and matching environment, weconsider the following modeling setups: right-to-manage...

Persistent link: https://www.econbiz.de/10005866597

Downward wage rigidity and optimal steady-state inflation

Fagan, Gabriel; Messina, Julián - European Central Bank - 2009

This paper examines the impact of downward wage rigidity (nominal and real) onoptimal steady-state inflation. For this … andFinland). The calibrated heterogeneous agent models are then solved for differentsteady state rates of inflation to derive …

Persistent link: https://www.econbiz.de/10005866626

Nonparametric Hybrid Phillips Curves Based on Subjective Expectations: Estimates for the Euro Area

Buchmann, Marco - European Central Bank - 2009

assumptions on the functional correspondence between price inflation, inflation expectations and marginal costs. Expectations are … not assumed to be an unbiased predictor of actual inflation and instead derived from the European Commission’s Consumer … Survey data. The results suggest that expectations drive inflation with a lag of about 6 months, which casts further doubt on …

Persistent link: https://www.econbiz.de/10008458424

The real effects of money growth in dynamic general equilibrium

Graham, Liam; Snower, Dennis J. - European Central Bank - 2004

We analyse the effects of money growth within a standard New Keynesian framework and show that the interaction between staggered nominal contracts and money growth leads to a long-run trade-off between output and money growth. We explore the microeconomic mechanisms that lead to this trade-off,...

Persistent link: https://www.econbiz.de/10005162920