Disinflationary boom in a price-wage spiral model

Olivier Musy and Jean-Christophe Pereau

Working Papers from HAL

Abstract: This paper analyses the impact of the disinflation policy timing on the sign and the magnitude of the sacrifice ratio in a modified price and wage staggered model of Blanchard (1986). When wages are updated every four quarters and prices every two quarters, we show that a "cold-turkey" disinflation is associated to an output boom when the policy is implemented during the last period of life of the wage contract and a recession the other quarters.

Keywords: Disinflation policy; Shock timing; Sacrifice ratio; Price and wage staggered contracts (search for similar items in EconPapers)
Date: 2009
Note: View the original document on HAL open archive server: https://hal.science/hal-04140853
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://hal.science/hal-04140853/document (application/pdf)

Related works:
Journal Article: Disinflationary boom in a price-wage spiral model (2010)
Working Paper: Disinflationary boom in a price-wage spiral model (2010)
Working Paper: Disinflationary boom in a price-wage spiral model (2009)
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:hal:wpaper:hal-04140853

Access Statistics for this paper

More papers in Working Papers from HAL
Bibliographic data for series maintained by CCSD ().