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Generalized Taylor and Generalized Calvo Price and Wage-Setting: Micro Evidence with Macro Implications

Dixon, Huw D.; Bihan, Hervé Le - CESifo - 2010

The Generalized Calvo and the Generalized Taylor model of price and wage-setting are, unlike the standard Calvo and … Taylor counter-parts, exactly consistent with the distribution of durations observed in the data. Using price and wage micro … monetary policy transmission by embedding these calibrated models in a standard DSGE model. The Generalized Taylor model is …

Persistent link: https://www.econbiz.de/10008572477

A Unified Framework for Using Micro-Data to Compare Dynamic Wage and Price Setting Models

Dixon, Huw D. - CESifo - 2010

durations found in the micro-data to generalized Taylor and Calvo models of time-dependent pricing. We illustrate the approach … Generalized Taylor Economy generates a hump shaped response function, whilst the Generalized Calvo does not. …

Persistent link: https://www.econbiz.de/10008572549

Macroeconomic Modeling when Agents are Imperfectly Informed

Grauwe, Paul De - CESifo - 2008

DSGE-models have become important tools of analysis not only in academia but increasingly in the board rooms of central banks. The success of these models has much to do with the coherence of the intellectual framework it provides. The limitations of these models come from the fact that they...

Persistent link: https://www.econbiz.de/10005405712

Leaning Against Windy Bank Lending

Melina, Giovanni; Villa, Stefania - CESifo - 2015

interest-rate rule features virtually no response to the growth of bank credit. However, the welfare loss associated to the …

Persistent link: https://www.econbiz.de/10011265258

Financial Frictions and Inflation Differentials in a Monetary Union

Hristov, Nikolay; Hülsewig, Oliver; Wollmershäuser, Timo - CESifo - 2010

This paper employs a stylized New Keynesian DSGE model for a monetary union to analyze whether cyclical inflation differentials can be explained by cross-country differences concerning the characteristics of financial markets. Our results suggest that empirically plausible degrees of...

Persistent link: https://www.econbiz.de/10008727289

Monetary Policy, Vagabonding Liquidity and Bursting Bubbles in New and Emerging Markets – An Overinvestment View

Hoffmann, Andreas; Schnabl, Gunther - CESifo - 2007

Credit booms have globally fuelled hikes in stock, raw material and real estate markets which have culminated in the recent US subprime market crisis. We explain the global asset market booms since the mid 1980s based on the overinvestment theories of Hayek, Wicksell and Schumpeter. We argue...

Persistent link: https://www.econbiz.de/10005094169

Inflation and Output Dynamics in a Model with Labor Market Search and Capital Accumulation

Heer, Burkhard; Maussner, Alfred - CESifo - 2007

In a sticky-price model with labor market search and habit persistence, Walsh (2005) shows that inertia in the interest rate policy helps to reconcile the inflation and output persistence with empirical observations for the US economy. We show that this finding is sensitive with regard to the...

Persistent link: https://www.econbiz.de/10005766166

Monetary Persistence and the Labor Market: A New Perspective

Lechthaler, Wolfgang; Merkl, Christian; Snower, Dennis - CESifo - 2010

In this paper we propose a novel way to model the labor market in the context of a New-Keynesian general equilibrium model, incorporating labor market frictions in the form of hiring and firing costs. We show that such a model is able to replicate many important stylized facts of the business...

Persistent link: https://www.econbiz.de/10008572528

Monetary Policy and the Relative Price of Durable Goods

Cantelmo, Alessandro; Melina, Giovanni - CESifo - 2015

In a VAR model of the US, the response of the relative price of durables to a monetary contraction is either flat or mildly positive. It significantly falls only if narrowly defined as the ratio between new house and nondurables prices. These findings survive three identification strategies and...

Persistent link: https://www.econbiz.de/10011272622

House Prices and Macroprudential Policy in an Estimated DSGE Model of New Zealand

Funke, Michael - 2017

We analyse the effects of macroprudential and monetary policies and their interactions using an estimated dynamic stochastic general equilibrium (DSGE) model tailored to New Zealand. We find that the main historical drivers of house prices are shocks specific to the housing sector. While our...

Persistent link: https://www.econbiz.de/10012953951