three independent components: idiosyncratic relative-price changes, a low-dimensional index of aggregate relative-price … price changes to fundamental economic shocks. We use the estimates of the pure inflation and aggregate relative-price … are they related to conventional measures of monetary policy and relative-price shocks? We find that pure inflation …

three independent components: idiosyncratic relative-price changes, a low-dimensional index of aggregate relative-price … the model on U.S. data since 1959, and it presents a simple structural model that relates the three components of price … changes to fundamental economic shocks. We use the estimates of the pure inflation and aggregate relative-price components to …