Inflation Rigidity and Monetary Policy Shocks1
نویسنده
چکیده
In this paper we explore the influence of inflation rigidity on the monetary policy transmission mechanism in a model featuring the hybrid Phillips curve. We compare the New Keynesian Phillips curve and the hybrid Phillips curve for their contribution to reproducing stylized empirical facts about business cycles driven by monetary policy shocks. Variables’ induced volatility and the dynamics of the impulse responses are analyzed. This includes the definition of a new persistence indicator based on the time profile of a variable’s conditional variances as generated by monetary shocks.
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