Inflation and output dynamics with state-dependent pricing decisions

• 成果类型: Article
• 署名作者: Burstein, Ariel T.
• 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.2005.05.006
• 发表日期: 2006
• 页码: 1235-1257
• 关键词: inflation; nominal rigidities; State-dependent pricing; inflation inertia

摘要

This paper studies a state-dependent pricing model in which firms face a fixed cost of changing their pricing plans. A pricing plan specifies an entire sequence of time-varying future prices. Allowing firms to choose a pricing plan rather than a single price generates inflation inertia in the response of the economy to small changes in the growth rate of money. Allowing firms to choose when to change their pricing plan generates a non-linear response of inflation and output to small and large changes in the money growth rate. The non-linear solution method also reveals that the model generates an asymmetric response of output and inflation to monetary expansions and contractions. (c) 2006 Elsevier B.V. All rights reserved.