Inflation dynamics under habit formation in hours

Gunes Kamber

Economics Letters, 2010, vol. 108, issue 3, 269-272

Abstract: This paper studies the implications of habit formation in hours for inflation dynamics. Using a New Keynesian Model, we show that habit formation in hours lowers the response of inflation to a monetary policy shock and that it can help to account for the observed sluggish response of inflation.

Keywords: New; Keynesian; Model; Habit; formation; in; hours; Inflation (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:108:y:2010:i:3:p:269-272

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