The "price puzzle" in the monetary transmission VARs with long-run restrictions

Dejan Krusec

Economics Letters, 2010, vol. 106, issue 3, 147-150

Abstract: This study addresses the "price puzzle" -- a positive response of prices to monetary tightening in VAR models. By using long-run instead of the usual short-run restrictions on the US data including output, prices and interest rate, we find that monetary tightening had a negative effect on prices.

Keywords: Long-run; restrictions; "Price; puzzle"; Monetary; transmission; VAR; Cointegration (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (10)

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