Staggered prices and trend inflation: some nuisances

被引:126
作者
Ascari, G [1 ]
机构
[1] Univ Pavia, Dept Econ & Quantitat Methods, I-27100 Pavia, Italy
关键词
inflation; staggered price/wages;
D O I
10.1016/j.red.2004.01.002
中图分类号
F [经济];
学科分类号
02 ;
摘要
Most of the papers in the sticky-price literature are based on a log-linearization around the zero inflation steady state, a simplifying but counterfactual assumption. This paper shows that when trend inflation is considered, both the long-run and the short-run properties of DGE models based on the Calvo staggered price model change dramatically. It follows that results obtained by models log-linearized around a zero inflation steady state are quite misleading. Furthermore, the same is not true for models based on the Taylor staggered price model, which is robust to changes in trend inflation. As a conclusion, the Taylor model is to be preferred, unless one is willing to index nominal variables. (C) 2004 Elsevier Inc. All rights reserved.
引用
收藏
页码:642 / 667
页数:26
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