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Exchange Rate Dynamics with Sticky Prices : The Deutsch Mark, 1974-1982

Giovannini, Alberto - 1984

This paper estimates simultaneously dynamic equations for the Deutsche Mark/Dollar exchange rate and the German wholesale price index, which emerge from a model in which German prices are sticky. This stickiness is due to price adjustment costs which take the form posited by Rotemberg(1982).The...

Persistent link: https://www.econbiz.de/10012477815

Dynamic Factor Demands Under Rational Expectations

Pindyck, Robert S. - 1982

This paper presents a dynamic model of the industrial demands for structures, equipment, and blue- and white-collar labor. Our approach is consistent with producers holding rational expectations and optimizing dynamically in the presence of adjustment costs, yet it permits generality of...

Persistent link: https://www.econbiz.de/10012478090

Intertemporal Substitution in Macroeconomics

Mankiw, N. Gregory - 1982

Modern neoclassical theories of the business cycle posit that aggregate fluctuations in consumption and employment are the consequence of dynamic optimizing behavior by economic agents who face no quantity constraint. In this paper, we estimate an explicit model :f this type. In particular, we...

Persistent link: https://www.econbiz.de/10012478210

International Adjustment with Wage Rigidity

Branson, William H. - 1979

Two of the puzzling macroeconomic phenomena of the 1970s have been the persistent stagnation in Europe, and the disagreement between the U.S. and Europe on the feasibility of recovery by demand expansion. This paper develops the hypothesis that the source of both the stagnation and the policy...

Persistent link: https://www.econbiz.de/10012478741

Persuasion and empathy in salesperson-customer interactions

Rotemberg, Julio J. - 2010

In a search model, prospects encounter salespeople who can try to persuade them. Persuasive messages can increase the utility of buying or increase the cost of not buying. The latter reduces welfare. Equilibria where only some salespeople make a persuasive effort often exist. Salespeople vary in...

Persistent link: https://www.econbiz.de/10012462677

Quality Provision, Expected Firm Altruism and Brand Extensions

Rotemberg, Julio J. - 2010

This paper studies quality choice in a model where consumers expect firms (or brands) to act altruistically. Under plausible assumptions regarding this altruism and the reaction of consumers to firms that demonstrate insufficient altruism, existing brands can face a larger demand for new...

Persistent link: https://www.econbiz.de/10012463015

Altruistic Dynamic Pricing with Customer Regret

Rotemberg, Julio J. - 2009

A model is considered where firms internalize the regret costs that consumers experience when they see an unexpected price change. Regret costs are assumed to be increasing in the size of price changes and this can explain why the size of price increases is less sensitive to inflation than in...

Persistent link: https://www.econbiz.de/10012463715

Liquidity Needs in Economies with Interconnected Financial Obligations

Rotemberg, Julio J. - 2008

A model is developed where firms in a financial system have to settle their debts to each other by using a liquid asset. The question that is studied is how many firms must obtain how much of this asset from outside the financial system to make sure that all debts within the system are settled....

Persistent link: https://www.econbiz.de/10012464425

Minimally Altruistic Wages and Unemployment in a Matching Model

Rotemberg, Julio J. - 2008

monopsonistically and set wages to retain their existing workers as well as to attract new ones. The model differs from Burdett and … for which the response of wages is modest relative to the response of employment, as appears to be the case in U.S. data …, for certain parameters, the model can explain both the standard deviations of employment and wages and the correlation …

Persistent link: https://www.econbiz.de/10012464892

Behavioral Aspects of Price Setting, and Their Policy Implications

Rotemberg, Julio J. - 2008

This paper starts by discussing consumers' cognitive and emotional reaction to posted prices. Cognitively, some consumers do not appear to make effective use of price information to maximize their consumption-based utility. Emotionally, prices can induce regret and anger among consumers. The...

Persistent link: https://www.econbiz.de/10012464893