The great moderation of inflationa structural analysis of recent U.S. monetary business cycles

  1. Casares Polo, Miguel
  2. Vázquez, Jesús
Journal:
Documentos de Trabajo ( Universidad Pública de Navarra. Departamento de Economía )

Year of publication: 2012

Issue: 15

Type: Working paper

DIALNET GOOGLE SCHOLAR lock_openAcademica-e editor

Abstract

U.S. inflation has experienced a great moderation in the last two decades. This paper examines the factors behind this and other stylized facts, such as the weaker correlation of inflation and nominal interest rate (Gibson paradox). Our findings point at lower exogenous variability of supply-side shocks and, to a lower extent, structural changes in money demand, monetary policy, and firms� sticky pricing behavior as the main driving forces of the changes observed in recent U.S. business cycles.

Data source: Dialnet