Output and Inflation Dynamics under Price and Wage Staggering Analytical Results

Jean-Pascal Benassy

Annals of Economics and Statistics, 2003, issue 69, 1-30

Abstract: In this paper we construct a dynamic stochastic general equilibrium model combining price and wage staggered contracts. A closed form solution is given for the optimal contracts and for the resulting macroeconomic dynamics, for any average length of price or wage contracts. We then investigate whether output and inflation can have a persistent and hump shaped response to monetary shocks under reasonable values for contract durations. We find that they do.

Date: 2003
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.jstor.org/stable/20076361 (text/html)

Related works:
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:adr:anecst:y:2003:i:69:p:1-30

Access Statistics for this article

Annals of Economics and Statistics is currently edited by Laurent Linnemer

More articles in Annals of Economics and Statistics from GENES Contact information at EDIRC.
Bibliographic data for series maintained by Secretariat General () and Laurent Linnemer ().