We decompose the low-frequency movements in labour productivity into an investment-neutral and investment-specific technology component. We show that neutral technology shocks cause a short run increase in job creation and job destruction and leads to a reduction in aggregate employment....

In this paper we provide evidence on the fit of the New Phillips Curve (NPC) for Spain over the most recent disinflationary period (1980-1998). Some of the findings can be summarized as follows: (a) the NPC fits the data well; (b) yet, the backward looking component of inflation is important;...

In this paper we present some descriptive evidence and simulation exercises with both an estimated backward looking model and a calibrated general equilibrium forward looking model that allow some light to be shed on the determinants and macroeconomic implications of persistent inflation...

The purpose of the present paper is twofold. First, we characterize de Fed's systematic response to technology shocks and its implications for US output, hours and inflation. Second we evaluate the extent to which that responses can be accounted for by a simple monetary policy rule in the...

This paper looks at the long term output effect of those monetary policies aimed at reducing inflation from its peak by late seventies, in nine major OECD countries. The estimated effect depends on the way nominal shocks are identified. Alternatively to the cross-country regression analysis we...

In this paper we show that value added mark ups tend to be pro cyclical in manufacturing and counter cyclical in market services. However, at the sectoral level value added mark ups may be misinterpreted if intermediate input variations are ignored. This is particularly true in the case of the...

We develop an OLG model aimed at explaining the joint determination of housing prices, rents, and interest rates, in an environment featuring a positive home ownership bias and individual borrowing limits that generate a mismatch between desired and available funds to finance housing purchases....

During the 1970s and early 1980s, Spain suffered high rates of inflation but inflation declined and by 1997 inflation had fallen to approximately 2 percent. To fight inflation, Spain implemented austere monetary programs, joined the EMS in 1989, enacted central bank autonomy in 1994, and...

Taking into account two salient Spanish stylized facts, namely, a persistent disinflationary process and hysteresis in the unemployment, this paper tries to answer the following question: Is a nominal permanent disinflation compatible with short-run unemployment costs but also with long-run...

Galí and Gertler (1999) developed a hybrid variant of the New Keynesian Phillips curve that relates inflation to real marginal cost, expected future inflation and lagged inflation. GMM estimates of the model suggest that forward looking behavior is dominant: The coefficient on expected future...