responses of output, inflation, labor share and the nominal interest rate to a supply shock as identified through a structural …

target have played a major role in the Euro area business cycle. Following an inflation target shock, the real interest rate …

that ERPT changes with the kind of shock and the monetary policy response to it. …

derived from Eurosystem large-scale macroeconomic models. The main finding is that only a fiscal shock, and to a lesser extent … a TFP shock, generate marked inflation persistence. In contrast, an indirect tax and an oil price shock appear much less … persistent and a social security shock generates less inflation persistence in the majority of the countries (although some weak …