Persistence of Shocks in an Experimental Dynamic Stochastic General Equilibrium Economy

Charles Noussair, Damjan Pfajfar and Janos Zsiros

A chapter in Experiments in Macroeconomics, 2014, vol. 17, pp 71-108 from Emerald Group Publishing Limited

Abstract: We design experimental economies based on a New Keynesian Dynamic Stochastic General Equilibrium (DSGE) model. We apply shocks to tastes, productivity, and interest rate policy, and measure the persistence of these shocks. We find that, in a setting where goods are perfect substitutes, there is little persistence of output shocks compared to treatments with monopolistic competition, which perform similarly irrespective of whether or not menu costs are present. Discretionary central banking is associated with greater persistence than automated instrumental rules.

Keywords: Experimental Economics; DSGE economy; monetary policy; menu costs (search for similar items in EconPapers)
Date: 2014
References: Add references at CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... 3-230620140000017003
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)

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:eme:rexezz:s0193-230620140000017003

DOI: 10.1108/S0193-230620140000017003

Access Statistics for this chapter

More chapters in Research in Experimental Economics from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().