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Nominal rigidities and the dynamic effects of a shock to monetary policy

Lawrence Christiano (), Martin Eichenbaum () and Charles Evans ()

No WP-01-08, Working Paper Series from Federal Reserve Bank of Chicago

Abstract: We present a model embodying moderate amounts of nominal rigidities which accounts for the observed inertia in inflation and persistence in output. The key features of our model are those that prevent a sharp rise in marginal costs after an expansionary shock to monetary policy. Of these features, the most important are staggered wage contracts of average duration three quarters, and variable capital utilization.

Keywords: Monetary; policy (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba, nep-dge and nep-pke
Date: 2001
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Related works:
Journal Article: Nominal Rigidities and the Dynamic Effects of a Shock to Monetary Policy (2005) Downloads
Journal Article: Nominal rigidities and the dynamic effects of a shock to monetary policy (2001) Downloads
Working Paper: Nominal rigidities and the dynamic effects of a shock to monetary policy (2001) Downloads
Working Paper: Nominal Rigidities and the Dynamic Effects of a Shock to Monetary Policy (2001) Downloads
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