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Comovements in aggregate and relative prices: some evidence on neutrality
Pauls, B. Dianne - Federal Reserve Board (Board of Governors of the … - 1986
aggregate price level and to demonstrate econometrically its equivalence to the exogeneity of relative prices with respect to … role for supply-side disturbances in explaining comovements in aggregate and relative prices. …
Persistent link: https://www.econbiz.de/10005498851
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Optimal monetary policy with staggered wage and price contracts
Erceg, Christopher J.; Henderson, Dale W.; Levin, Andrew T. - Federal Reserve Board (Board of Governors of the … - 1999
-optimal equilibrium that would occur under completely flexible wages and prices; that is, the model exhibits a tradeoff between … stabilizing the output gap, price inflation, and wage inflation. The Pareto optimum is attainable only if either wages or prices …
Persistent link: https://www.econbiz.de/10005712759
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Tradeoffs between inflation and output-gap variances in an optimizing-agent model
Erceg, Christopher J.; Henderson, Dale W.; Levin, Andrew T. - Federal Reserve Board (Board of Governors of the … - 1998
the special case in which prices are sticky and wages are perfectly flexible. When the model is calibrated to exhibit an …
Persistent link: https://www.econbiz.de/10005368225
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Price level convergence, relative prices, and inflation in Europe
Rogers, John H. - Federal Reserve Board (Board of Governors of the … - 2001
If price levels are initially different across the euro area, convergence to a common level of prices would imply that … inflation will be higher in countries where prices are initially low. Price level convergence thus provides a potential … between 1990 and 1999 prices did become less dispersed in the euro area. Convergence is especially evident for traded goods …
Persistent link: https://www.econbiz.de/10005368283
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Optimal monetary policy with distinct core and headline inflation rates
Bodenstein, Martin; Erceg, Christopher J.; Guerrieri, Luca - Federal Reserve Board (Board of Governors of the … - 2008
In a stylized DSGE model with an energy sector, the optimal policy response to an adverse energy supply shock implies a rise in core inflation, a larger rise in headline inflation, and a decline in wage inflation. The optimal policy is well-approximated by policies that stabilize the output gap,...
Persistent link: https://www.econbiz.de/10005368420
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Inflation dynamics
Guerrieri, Luca - Federal Reserve Board (Board of Governors of the … - 2001
Gali and Gertler (1999) are the first to find that the baseline sticky price model fits the U.S. data well. I examine the robustness of their estimates along two dimensions. First, I show that their IV estimates are not robust to an alternative normalization of the moment condition being...
Persistent link: https://www.econbiz.de/10005498721
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Regional inflation in a currency union: fiscal policy vs. fundamentals
Duarte, Margarida; Wolman, Alexander L. - Federal Reserve Board (Board of Governors of the … - 2002
We develop a general equilibrium model of a two-region currency union. There are two types of goods: non-trade goods, and traded goods for which markets are segmented. Monetary policy is set by a central monetary authority and is non-neutral due to nominal price rigidities. Fiscal policy is...
Persistent link: https://www.econbiz.de/10005498738
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The inflation persistence of staggered contracts
Guerrieri, Luca - Federal Reserve Board (Board of Governors of the … - 2002
One of the criticisms routinely advanced against models of the business cycle with staggered contracts is their inability to generate inflation persistence. This paper finds that staggered Taylor contracts are, in fact, capable of reproducing the inflation persistence implied by U.S. data....
Persistent link: https://www.econbiz.de/10005498773
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Can the U.S. monetary policy fall (again) in an expectation trap?
Armenter, Roc; Bodenstein, Martin - Federal Reserve Board (Board of Governors of the … - 2006
We provide a tractable model to study monetary policy under discretion. We focus on Markov equilibria. For all parametrizations with an equilibrium inflation rate around 2%, there is a second equilibrium with an inflation rate just above 10%. Thus the model can simultaneously account for the low...
Persistent link: https://www.econbiz.de/10005498813
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Long-term evidence on the Tobin and Fisher effects: a new approach
Ahmed, Shaghil; Rogers, John H. - Federal Reserve Board (Board of Governors of the … - 1996
Using a new approach, we reexamine the empirical evidence on the long-term interactions between inflation and real variables. We find, using over 100 years of U.S. data, that in the long run the effect of inflation on investment and output is positive (a "Tobin type effect") and the investment...
Persistent link: https://www.econbiz.de/10005498815