Do demand or supply shocks which are not accompanied by new information affect prices? If so, is the price effect temporary ("price pressure hypothesis") or permanent ("imperfect substitutes hypothesis")? Numerous empirical studies have dealt with these questions and yet the issue is still...

This paper attempts to assess whether money can generate persistent economic" fluctuations in dynamic general equilibrium models of the business cycle. We show that a small" nominal friction in the goods market can make the response of output to monetary shocks large" and persistent if it is...

This paper attempts to assess whether money can generate persistent economic" fluctuations in dynamic general equilibrium models of the business cycle. We show that a small" nominal friction in the goods market can make the response of output to monetary shocks large" and persistent if it is...