منابع مشابه
Do Flexible Durable Goods Prices Undermine Sticky Price Models?
The “neoclassical synthesis” sticky price model exhibits strange behavior when augmented with markets for durable goods with flexible prices. While in the data the output of durable goods responds strongly and positively to a loosening of monetary policy, in dynamic general equilibrium models a monetary expansion causes the output of flexibly priced durables to contract. In an instructive speci...
متن کاملInternational Trade in Durable Goods in Sticky Price Models
Engel and Wang (2008) argue that trade in durable goods is important for international real-businesscycle models to replicate the behavior of real imports and exports. We extend such a model with Calvostyle price stickiness. We find that the model with producer currency pricing (PCP) for investment goods and local currency pricing (LCP) for durable consumption performs better than the model wit...
متن کاملIntermittent Purchases and Welfare-Based Price Deflators for Durable Goods
The consensus among inflation watchers is that biases in official price indexes like the consumer price index overstate true inflation. We identify a new source of bias that works in the other direction. In particular, we use a simple dynamic model for durable goods—one type of good typically purchased intermittently—to derive equivalent variations and a true COL index. We show that, all else h...
متن کاملEvaluating Calvo-Style Sticky Price Models∗
This paper assesses the empirical performance of Calvo-style sticky goods price models. We argue that Calvo-style models in which firms update non-reoptimized prices to lagged inflation are consistent with the aggregate data in a statistical sense. We then investigate whether these models imply plausible degrees of inertia in price setting behavior by firms. We find that these model do, but onl...
متن کاملDurable Goods and Conformity
Is the variety of products supplied in markets a reflection of the diversity of consumers’ preferences? In this paper, we argue that the distribution of durable goods offered in markets tends to be compressed relative to the distribution of consumers’ underlying preferences. In particular, there are strong incentives for conformity in markets for durable goods. The reason for conformity is natu...
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ژورنال
عنوان ژورنال: American Economic Review
سال: 2007
ISSN: 0002-8282
DOI: 10.1257/aer.97.3.984