Price stickiness, inflation, and output dynamics : a cross-country analysis / by Hashmat Khan. : FB3-2/100-12E-PDF
This paper investigates a key implication of the sticky-price model of business cycle that is designed to explain the observed persistence in output fluctuations around its long-run growth path. A prediction of this model is that a higher trend inflation rate will increase the frequency of price adjustment and thereby inversely affect the persistence in deviations of output from its trend. Therefore, countries with a high trend inflation rate should have less-persistent output fluctuations. The characteristics of the data set available to examine this hypothesis raise several implementation issues. This paper focuses on those issues in a manner that is consistent with the theoretical framework of the model.--Concluding remarks
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| Department/Agency | Bank of Canada. |
|---|---|
| Title | Price stickiness, inflation, and output dynamics : a cross-country analysis / by Hashmat Khan. |
| Series title | Bank of Canada working paper1701-93972000-12 |
| Publication type | Series - View Master Record |
| Language | [English] |
| Format | Electronic |
| Electronic document | |
| Other formats | Paper-[English] |
| Note(s) | "This paper investigates a key implication of the sticky-price model of business cycle that is designed to explain the observed persistence in output fluctuations around its long-run growth path. A prediction of this model is that a higher trend inflation rate will increase the frequency of price adjustment and thereby inversely affect the persistence in deviations of output from its trend. Therefore, countries with a high trend inflation rate should have less-persistent output fluctuations. The characteristics of the data set available to examine this hypothesis raise several implementation issues. This paper focuses on those issues in a manner that is consistent with the theoretical framework of the model."--Concluding remarks. The ISBN (0-662-29132-8) for the print edition has been incorrectly copied in this electronic publication. Résumé en français |
| Publishing information | Ottawa - Ontario : Bank of Canada July 2000. |
| Description | 56p.figs., graphs, references, tables |
| ISSN | 1701-9397 |
| Catalogue number |
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| Subject terms | Inflation Prices Exchange rates |