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Changes in the Balance of Power Between the Wage and Price Setters and the Central Bank: Consequences for the Phillips Curve and the NAIRU

Kromphardt, Jürgen; Logeay, Camille - Institut für Weltwirtschaft (IfW) - 2007

In this paper we introduce and test the hypothesis that the relation between inflation and unemployment has been in many countries subject to a significant change in the early 1990's after the disinflation period. That period began between 1975 and 1980 after the first (or the second) oil price...

Persistent link: https://www.econbiz.de/10005755220

Inflation Targeting Is a Success, So Far: 100 Years of Evidence from Swedish Wage Contracts

Fregert, Klas; Jonung, Lars - Institut für Weltwirtschaft (IfW) - 2008

, inflation targeting gained instant credibility in the sense that the labor market organizations entered long-term wage …

Persistent link: https://www.econbiz.de/10005083376

Gaining credibility and enhancing economic growth through regional integration: The case for EU membership of Eastern Europe

Piazolo, Daniel - Institut für Weltwirtschaft (IfW) - 1997

countries (CEECs) can potentially enhance the credibility of their governments' policies through institutional integration with … the EU. The paper discusses the credibility problems faced by the CEECs and shows how EU membership will enhance the … institutional setting and the governments' credibility. Based on regression results between an indicator of institutional change and …

Persistent link: https://www.econbiz.de/10009276477

State-dependence vs. Time-dependence: An Empirical Multi-Country Investigation of Price Sluggishness

Ahrens, Steffen; Hartmann, Matthias - Institut für Weltwirtschaft (IfW) - 2014

In this paper we empirically investigate the time- and state-dependent behavior of aggregate price setting. We implement a testing procedure by means of a nonparametric representation of the structural form New Keynesian Phillips curve. By means of the so-called functional coefficient regression...

Persistent link: https://www.econbiz.de/10010886935

The Price-Price Phillips Curve in Small Open Economies and Monetary Unions: Theory and Empirics

Vaona, Andrea - Institut für Weltwirtschaft (IfW) - 2014

This paper extends the efficiency wages/partially adaptive expectations Phillips curve, otherwise known as the price-price Phillips curve, from a closed economy context to an open economy one with both commodity trade and capital mobility. We also consider the case of a monetary union (a...

Persistent link: https://www.econbiz.de/10010886968

A reappraisal of the inflation-unemployment tradeoff

Karanassou, Marika; Sala, Héctor; Snower, Dennis J. - Institut für Weltwirtschaft (IfW) - 2005

This paper offers a reappraisal of the inflation-unemployment tradeoff, based on ?frictional growth,? describing the interplay between nominal frictions and money growth. When the money supply grows in the presence of price inertia (due to staggered wage contracts with time discounting), the...

Persistent link: https://www.econbiz.de/10010955553

Fairness and the disinflation puzzle

Lunardelli, Andre - Institut für Weltwirtschaft (IfW) - 2014

Following Driscoll and Holden (2004), I model forward-looking workers who consider it unfair if a wage adjustment fails to match past inflation. However, the present paper proposes a much larger effect by using the job finding rate as the measure of workers' opportunities outside the firm rather...

Persistent link: https://www.econbiz.de/10010956041

Endogenous Indexing and Monetary Policy Models

Mash, Richard - Institut für Weltwirtschaft (IfW) - 2007

Models in which firms use a rule of thumb or partial indexing in price setting are prominent in the recent monetary policy literature. The extent to which these firms adjust their prices to lagged inflation has been taken as fixed. We consider the implications of firms choosing the optimal...

Persistent link: https://www.econbiz.de/10005083332

What Do Micro Price Data Tell Us on the Validity of the New Keynesian Phillips Curve?

Álvarez, Luis J. - Institut für Weltwirtschaft (IfW) - 2007

The New Keynesian Phillips curve (NKPC) is now the dominant model of inflation dynamics. In recent years, a large body of empirical research has documented price-setting behaviour at the individual level, allowing the assessment of the micro-foundations of pricing models. This paper analyses the...

Persistent link: https://www.econbiz.de/10005083421

Productivity Shocks and the New Keynesian Phillips Curve: Evidence from US and Euro Area

Ambrocio, Gene; Jang, Tae-Seok - Institut für Weltwirtschaft (IfW) - 2009

This paper seeks to understand dynamics of inflation and marginal cost (labor share) in models that account for the inclusion of productivity shocks in standard New Keynesian Phillips Curve (NKPC). The question of interest is on the empirical importance of and whether productivity shocks shift...

Persistent link: https://www.econbiz.de/10005049591