About this document
W 7551 by denizrobopar is a document available to read on EtoBox.
The paper develops and estimates a structural model of inflation that incorporates both forward-looking and backward-looking price-setting behaviors. It finds that real marginal costs are a significant determinant of inflation, while backward-looking behavior is statistically significant but not quantitatively important. The results support the New Keynesian Phillips curve as a reasonable approximation of inflation dynamics, highlighting the need to re-examine traditional explanations of inflation inertia.
- Author
- denizrobopar
- Language
- EN