Using a multi-period general equilibrium model, this paper extends the results of Mankiw (1991) by showing that monopolistically competitive firms may require 'relatively large' menu costs to dissuade them from changing prices in response to an aggregate demand shock that is perceived to be...

This paper uses recent developments in measuring correlation to examine the relationship between inflation and relative price variability (RPV). The results suggest that the positive correlation holds not only in the short run but also in the long run. This finding has important implications for...

Using model selection techniques based on out-of-sample predictive ability criterion in a Vector Autoregression (VAR) framework, this paper empirically examines the causal relations among growth, trade, and wage inequality in Bangladesh between 1971 and 2000. There is some evidence of...

This paper describes a classroom simulation of the FOMC meeting designed for an upper-level monetary economics class. This is a role-playing exercise in which students are assigned various roles as individuals or as groups that directly or indirectly participate in the FOMC meeting and in the...