Asymmetric inflation expectations, downward rigidity of wages, and asymmetric business cycles

• 成果类型: Article
• 署名作者: Baqaee, David Rezza
• 署名单位: University of California System; University of California Los Angeles
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2019.04.014
• 发表日期: 2020
• 页码: 174-193
• 关键词: Ambiguity aversion; Downward sticky wages; Asymmetric business cycles; Inflation expectations; Limited information

摘要

Households' inflation expectations are more responsive to inflationary news than to disinflationary news, and this asymmetry in expectations can cause downward wage rigidity. Asymmetric expectations imply that monetary policy can have asymmetric effects on employment and wages. I microfound asymmetric household expectations using ambiguity aversion: households, who do not know the quality of their information, overweight inflationary news since it reduces their purchasing power, and underweight deflationary news since it increases their purchasing power. Although wages are downwardly rigid in this environment, monetary policy need not have a bias towards using inflation to grease the wheels of the labor market.