The perils of first-order conditions of New Keynesian models

For deriving equilibrium of sticky-price/monopolistic competition New Keynesian models, first-order conditions are often used. This paper shows that they may not be sufficient and presents a case out of a simple model where there exists no equilibrium. This is true even when Taylor rule is assumed.

MoreLess

Year of publication:	2016-04-14
Authors:	Kim, Minseong

More details

Type of publication:	Book / Working Paper
Language:	English
Notes:	Kim, Minseong (2016): The perils of first-order conditions of New Keynesian models.
Classification:	B41 - Economic Methodology ; C61 - Optimization Techniques; Programming Models; Dynamic Analysis ; C62 - Existence and Stability Conditions of Equilibrium ; E13 - Neoclassical ; E52 - Monetary Policy (Targets, Instruments, and Effects)
Source:	BASE

Persistent link: https://www.econbiz.de/10015251610