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Both imperfect information and sticky prices allow nominal shocks to act as business cycle impulses, but only sticky … prices propagate the real effects of nominal shocks. A simple model of imperfect information and sticky prices developed …
Persistent link: https://www.econbiz.de/10005721266
often be approximated by a metropolitan area or a rural county. Banks are assumed to set retail prices based on the …
Persistent link: https://www.econbiz.de/10005393672
Persistent link: https://www.econbiz.de/10005393863
This paper compares staggered price setting to partial adjustment of prices in a small optimizing IS/LM model. In …
Persistent link: https://www.econbiz.de/10005394062
Persistent link: https://www.econbiz.de/10005394146
setting lower the elasticity of marginal cost with respect to output, and these same model features tend to generate …
Persistent link: https://www.econbiz.de/10005513007
Persistent link: https://www.econbiz.de/10005514179
Output growth is negatively correlated with inflation, and detrended output is positively correlated with inflation, in the major North American and European economies. In addition, output growth and detrended output lead inflation. I explore the consistency of these correlations with three...
Persistent link: https://www.econbiz.de/10005514184