Hidden Bibliographic Details
| Other authors / contributors: | Khramov, Vadim.
International Monetary Fund.
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| ISBN: | 147558640X
9781475586404
9781475586404
9781475502350
1475502354
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| Notes: | Available in PDF, ePUB, and Mobi formats on the Internet.
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| Summary: | The simulated results of this paper show that New Keynesian DSGE models with capital accumulation can generate substantial persistencies in the dynamics of the main economic variables, due to the stock nature of capital. Empirical estimates on U.S. data from 1960:I to 2008:I show the response of monetary policy to inflation was almost twice lower than traditionally considered, as capital accumulation creates an additional channel of influence through real interest rates in the production sector. Versions of the model with indeterminacy empirically outperform determinate versions. This paper allows for the reconsideration of previous findings and has significant monetary policy implications.
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| Standard no.: | 10.5089/9781475586404.001
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