DP8407 Is there a trade-off between inflation and output stabilization?
|Author(s):||Alejandro Justiniano, Giorgio E Primiceri, Andrea Tambalotti|
|Publication Date:||June 2011|
|Keyword(s):||optimal policy, output gap, potential output|
|Programme Areas:||International Macroeconomics|
|Link to this Page:||http://www.cepr.org/pubs/dps/DP8407|
Not in an estimated DSGE model of the US economy, once we account for the fact that most of the high-frequency volatility in wages appears to be due to noise, rather than to variation in workers' preferences or market power.