Title of article :
Endogenousnominalrigiditiesandmonetarypolicy
Author/Authors :
Takeshi Kimura، نويسنده , , TakushiKurozumi ، نويسنده ,
Issue Information :
روزنامه با شماره پیاپی سال 2010
Abstract :
Recentempiricalresearchfindsthatthedegreeofnominalrigiditiesvariesover
monetarypolicyregimes.Thisimpliesthatmonetarypolicyanalysiswithexogenously
givennominalrigiditiesissubjecttotheLucascritique.Weallowfirmstochoosethe
probabilityofpriceadjustmentinaCalvo-stylestickypricemodel,andanalyzehowthis
probabilitychangesaccordingtoaninflationcoefficientoftheTaylorrule.Themodel
showsthatamoreaggressivemonetarypolicyresponsetoinflationmakesfirmsless
likelytoresetpricesandgivestheresultingNewKeynesianPhillipscurveaflatterslope
and asmallerdisturbance,asobservedduringtheVolcker-Greenspanera.Also,sucha
policyresponsecanstabilizebothinflationandtheoutputgapbyexploitingthe
feedbackeffectsofthispolicyresponseonfirms’price-setting.Theseresultsoffer
theoreticalsupportforthegoodpolicyhypothesisabouttheGreatModeration
Journal title :
Journal of Monetary Economics
Journal title :
Journal of Monetary Economics
