Working paper
Monetary policy with an endogenous capital stock when inflation is persistent
- Abstract:
-
The paper presents a monetary policy model with an endogenous capital stock when a backward looking element in wage setting causes inflation persistence. We analyse how the endogeneity of the capital stock changes the macroeconomic dynamics with which policy interacts and its implications for optimal policy and time inconsistency. Capital stock endogeneity makes inflation more persistent in reduced form. This makes the optimal contemporaneous policy response to shocks more vigorous but the su...
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- Publication status:
- Published
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Bibliographic Details
- Publisher:
- University of Oxford
- Series:
- Department of Economics Discussion Paper Series
- Publication date:
- 2002-07-01
- Paper number:
- 108
Item Description
- Keywords:
- Pubs id:
-
1144311
- Local pid:
-
pubs:1144311
- Deposit date:
-
2020-12-15
Terms of use
- Copyright date:
- 2002
- Rights statement:
- Copyright 2002 The Author(s)
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