Journal ArticleDOI
Staggered prices in a utility-maximizing framework
TLDR
In this article, the authors developed a model of staggered prices along the lines of Phelps (1978) and Taylor (1979, 1980), but utilizing an analytically more tractable price-setting technology.About:
This article is published in Journal of Monetary Economics.The article was published on 1983-09-01. It has received 8580 citations till now. The article focuses on the topics: Nominal rigidity & Taylor rule.read more
Citations
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Incomplete pass-through and the welfare effects of exchange rate variability
TL;DR: In this paper, the authors consider the implications of incomplete exchange rate pass-through for optimal monetary and exchange rate policy and derive welfare functions in terms of a weighted sum of the second moments of producer prices and the nominal exchange rate.
Journal ArticleDOI
Modern Forecasting Models in Action: Improving Macroeconomic Analyses at Central Banks
Malin Adolfson,Michael K. Andersson,Jesper Lindé,Mattias Villani,Mattias Villani,Anders Vredin,Anders Vredin +6 more
TL;DR: In this article, the authors compare the performance of BVAR and DSGE models with the Riksbank's official, more subjective forecasts, both in terms of the actual forecasts and root mean square errors.
Journal ArticleDOI
Estimated Open Economy New Keynesian Phillips Curves for the G7
Campbell Leith,Jim Malley +1 more
TL;DR: In this paper, an open economy model of firms' pricing behavior under imperfect competition is developed, which allows to introduce various terms of trade effects influencing the firm's pricing decision, in addition to labour costs which dominate most closed economy specifications of the New Keynesian Phillips curve (NKPC).
Journal ArticleDOI
Inflation Dynamics and the Cost Channel of Monetary Transmission
TL;DR: In this paper, the authors apply a structural approach to examine the relevance of the cost channel for inflation dynamics in G7 countries by augmenting the hybrid New Keynesian Philips curve by letting firms' costs for external funds rise with the short run nominal interest rate.
Posted Content
Exchange-Rate-Based Stabilization under Imperfect Credibility
TL;DR: The authors analyzes stabilization policy under predetermined exchange rates in a cash-in-advance, staggered-prices model, and shows that a reduction in the rate of devaluation results in an immediate and permanent reduction in inflation rate, with no effect on output or consumption.
References
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Book
The Theory of Matrices
TL;DR: In this article, the Routh-Hurwitz problem of singular pencils of matrices has been studied in the context of systems of linear differential equations with variable coefficients, and its applications to the analysis of complex matrices have been discussed.
Journal ArticleDOI
Aggregate Dynamics and Staggered Contracts
TL;DR: In this article, the authors show that staggered wage contracts as short as 1 year are capable of generating the type of unemployment persistence which has been observed during postwar business cycles in the United States.
Journal ArticleDOI
"Rational" Expectations, the Optimal Monetary Instrument, and the Optimal Money Supply Rule
Thomas J. Sargent,Neil Wallace +1 more
TL;DR: In this paper, alternative monetary policies are analyzed in an ad hoc macroeconomic model in which the public's expectations about prices are rational, and it turns out that the probility distribution of output is independent of the particular deterministic money supply rule in effect.
Book
Public Investment, the Rate of Return, and Optimal Fiscal Policy
Kenneth J. Arrow,Mordecai Kurz +1 more
TL;DR: In this paper, a theory of "controllability" is developed and injected into public economics and growth models to analyze optimal public expenditures in the context of modern growth theory, and a model of optimal growth with public capital is proposed.