The correlation between persistent changes in the markup in one sector of an economy and the inflation rate is quantified in a 2-sector dynamic general equilibrium model. How this relationship is affected by monetary policy is also studied. We find that the correlation is in general positive...

This paper estimates a series of shocks to hit the US economy during the Great Depression, using a New Keynesian model with unemployment and bargaining frictions. Shocks to long-run inflation expectations appear to account for much of the cyclical behavior of employment, while an increase in...

Die Entschlossenheit der Wirtschaftspolitik,sich mit niedrigen Zinsen undfi skalischen Impulsen gegen dieWeltwirtschaftskrise zu stemmen,provoziert Infl ationsbefürchtungen.Sie beruhen teilweise auf Mißverständnissenhinsichtlich des „Gelddruckens“der Notenbanken. Die Geldpolitikverfügt...