Arbeitspapier
A reappraisal of the inflation-unemployment tradeoff
This paper offers a reappraisal of the inflation-unemployment tradeoff, based on "frictional growth," describing the interplay between nominal frictions and money growth. When the money supply grows in the presence of price inertia (due to staggered wage contracts with time discounting), the price adjustments to each successive change in the money supply are never able to work themselves out fully. In this context, monetary shocks have a gradual and delayed effect on inflation and these shocks also generate plausible impulse-responses for unemployment. Although our theory contains no money illusion, no permanent nominal rigidities, and no departure from rational expectations, there is a long-run inflation-unemployment tradeoff.
- Sprache
-
Englisch
- Erschienen in
-
Series: Working Paper ; No. 479
- Klassifikation
-
Wirtschaft
- Thema
-
Inflation
unemployment
Phillips curve
nominal inertia
wage-price staggering
monetary policy
business cycles
forward-looking expectations
Phillips-Kurve
Schätzung
Theorie
USA
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Karanassou, Marika
Sala, Héctor
Snower, Dennis J.
- Ereignis
-
Veröffentlichung
- (wer)
-
Queen Mary University of London, Department of Economics
- (wo)
-
London
- (wann)
-
2002
- Handle
- Letzte Aktualisierung
-
20.09.2024, 08:22 MESZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- Karanassou, Marika
- Sala, Héctor
- Snower, Dennis J.
- Queen Mary University of London, Department of Economics
Entstanden
- 2002
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