autoregression (VAR) approach. Identification of the tax shock follows the narrative approach recently proposed by Romer and Romer …

hours worked in post-World War II U.S. data. In our model, the real effects of an energy shock are amplified when the … monetary authority responds to that shock by changing its inflation objective. Specifically, higher inflation raises households … inflation and lower labor productivity following a negative energy shock is consistent with the stagflation of the 1970s. The …