Publication
Mar 2009
This paper finds that when taken to examine disinflation monetary policies, the current DSGE model of business cycle fluctuations successfully accounts for the main stylized facts in terms of recessionary effects and sacrifice ratio. The authors complement the transitional analysis of the short-run costs with a welfare evaluation and show that, despite the long-lasting economic downturn, disinflation entails non-zero overall welfare gains.
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English (PDF, 31 pages, 608 KB) |
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Author | Guido Ascari, Tiziano Ropele |
Series | Kiel Institute Working Papers |
Issue | 1499 |
Publisher | Kiel Institute for the World Economy |
Copyright | © 2009 Kiel Institute for the World Economy |