Nonlinear Dynamics in Menu Cost Economies? Evidence from U.S. Data

Andrés Blanco, Corina Boar, Callum Jones and Virgiliu Midrigan

No 32748, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We show that standard menu cost models cannot simultaneously reproduce the dispersion in the size of micro-price changes and the extent to which the fraction of price changes increases with inflation in the U.S. time-series. Though the Golosov and Lucas (2007) model generates fluctuations in the fraction of price changes, it predicts too little dispersion in the size of price changes and therefore little monetary non-neutrality. In contrast, versions of the model that reproduce the dispersion in the size of price changes and generate stronger monetary non-neutrality predict a nearly constant fraction of price changes.

JEL-codes: E3 (search for similar items in EconPapers)
Date: 2024-07
New Economics Papers: this item is included in nep-mon
Note: EFG ME
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.nber.org/papers/w32748.pdf (application/pdf)
Access to the full text is generally limited to series subscribers, however if the top level domain of the client browser is in a developing country or transition economy free access is provided. More information about subscriptions and free access is available at http://www.nber.org/wwphelp.html. Free access is also available to older working papers.

Related works:
Working Paper: Nonlinear Dynamics in Menu Cost Economies? Evidence from U.S. Data (2024)
Working Paper: Nonlinear Dynamics in Menu Cost Economies? Evidence from U.S. Data (2024)
Working Paper: Nonlinear Dynamics in Menu Cost Economies? Evidence from U.S. Data (2024)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:32748

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w32748
The price is Paper copy available by mail.

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().