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AuthorEl Omari, Salaheddine
AuthorBenlagha, Noureddine
Available date2023-10-08T09:57:35Z
Publication Date2023-02-03
Publication NameApplied Economics
Identifierhttp://dx.doi.org/10.1080/00036846.2023.2169240
CitationEl Omari, S., & Benlagha, N. (2023). Accounting for inflation dynamic in a fully optimizing macroeconomic framework: evidence from the US states. Applied Economics, 1-17.
ISSN0003-6846
URIhttps://www.scopus.com/inward/record.uri?partnerID=HzOxMe3b&scp=85147658199&origin=inward
URIhttp://hdl.handle.net/10576/48323
AbstractThis article proposes a New Keynesian DSGE model that can capture the hump-shaped response of inflation to a monetary policy shock that does not depend upon backward-looking elements for the price and wage-setting, such as the indexation of wages or prices. The two additional elements required to achieve a hump-shaped response are roundabout production structure (input–output structure for production) and working capital. Depending on the model’s parameterization, this channel can provide a pronounced response of inflation. In addition, our article provides some reduced-form evidence about the hump-shaped response of inflation using a VAR with Cholesky ordering.
Languageen
PublisherTaylor & Francis
SubjectEndogenous propagation
inflation persistence problem
new Keynesian DSGE model
roundabout production structure
working capital
TitleAccounting for inflation dynamic in a fully optimizing macroeconomic framework: evidence from the US states
TypeArticle
Pagination1-17
ESSN1466-4283
dc.accessType Open Access


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