Asymmetric monetary policy tradeoffs
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- dc.contributor.author Debortoli, Davide
- dc.contributor.author Forni, Mario
- dc.contributor.author Gambetti, Luca
- dc.contributor.author Sala, Luca
- dc.contributor.other Universitat Pompeu Fabra. Departament d'Economia i Empresa
- dc.date.accessioned 2024-11-14T10:09:44Z
- dc.date.available 2024-11-14T10:09:44Z
- dc.date.issued 2020-06-01
- dc.date.modified 2024-11-14T10:07:15Z
- dc.description.abstract We measure the inflation-unemployment tradeoff associated with monetary easing and tightening, during booms and recessions, using a novel nonlinear Proxy-SVAR approach. We find evidence of significant non-linearities for the U.S. economy (1973:M1 - 2019:M6): stimulating economic activity during recessions is associated with minimal costs in terms of inflation, and reducing inflation during booms delivers small costs in terms of unemployment. Overall, these results provide support for countercyclical monetary policies, in contrast with what predicted by a flat Phillips curve, or previous studies on nonlinear effects of monetary policy. Our results can be rationalized by a simple model with downward nominal wage rigidity, which is also used to assess the validity of our empirical approach.
- dc.format.mimetype application/pdf*
- dc.identifier https://econ-papers.upf.edu/ca/paper.php?id=1742
- dc.identifier.citation
- dc.identifier.uri http://hdl.handle.net/10230/68594
- dc.language.iso eng
- dc.relation.ispartofseries Economics and Business Working Papers Series; 1742
- dc.rights L'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative Commons
- dc.rights.accessRights info:eu-repo/semantics/openAccess
- dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
- dc.subject.keyword monetary policy shocks
- dc.subject.keyword nonlinear effects
- dc.subject.keyword structural var models
- dc.subject.keyword Macroeconomics and International Economics
- dc.title Asymmetric monetary policy tradeoffs
- dc.title.alternative
- dc.type info:eu-repo/semantics/workingPaper