Sacrifice Ratios with Long-Lived Effects
AbstractThis paper is a theoretical and empirical study of sacrifice ratios-that is, the cost of reducing inflation during periods when disinflation produces long-lived effects on output or unemployment. New methods are developed for measuring sacrifice ratios. Sacrifice ratios that take into account long-lived effects are larger than sacrifice ratios calculated using Ball's (1994) 'standard method'. The 'standard method' also has a larger downward bias for countries experiencing larger long-lived effects. The sacrifice ratio for the United States falls somewhere in the middle of those for G-7 countries when long-lived effects are taken into account, while it is at the top when calculated using the 'standard method'. Finally, there is a negative relationship between sacrifice ratios and initial inflation rates, and the cost of reducing inflation is generally lower when the speed of disinflation is faster. Copyright Blackwell Publishing Ltd. 2005
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Wiley Blackwell in its journal International Finance.
Volume (Year): 8 (2005)
Issue (Month): 2 (08)
Contact details of provider:
Web page: http://www.blackwellpublishing.com/journal.asp?ref=1367-0271
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Emmanuel De Veirman, 2007.
"Which nonlinearity in the Phillips curve? The absence of accelerating deflation in Japan,"
Reserve Bank of New Zealand Discussion Paper Series
DP2007/14, Reserve Bank of New Zealand.
- Emmanuel De Veirman, 2009. "What Makes the Output-Inflation Trade-Off Change? The Absence of Accelerating Deflation in Japan," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 41(6), pages 1117-1140, 09.
- Emmanuel De Veirman, 2007. "Which Nonlinearity in the Phillips Curve? The Absence of Accelerating Deflation in Japan," Economics Working Paper Archive 536, The Johns Hopkins University,Department of Economics.
- Guido Ascari & Tiziano Ropele, 2010.
"Disinflation in a DSGE Perspective: Sacrifice Ratio or Welfare Gain Ratio?,"
Quaderni di Dipartimento
111, University of Pavia, Department of Economics and Quantitative Methods.
- Ascari, Guido & Ropele, Tiziano, 2012. "Disinflation in a DSGE perspective: Sacrifice ratio or welfare gain ratio?," Journal of Economic Dynamics and Control, Elsevier, vol. 36(2), pages 169-182.
- Guido Ascari & Tiziano Ropele, 2009. "Disinflation in a DSGE Perspective: Sacrifice Ratio or Welfare Gain Ratio?," Kiel Working Papers 1499, Kiel Institute for the World Economy.
- Mazumder, Sandeep, 2014. "The sacrifice ratio and core inflation," Journal of Macroeconomics, Elsevier, vol. 40(C), pages 400-421.
- Ascari, Guido & Ropele, Tiziano, 2013.
"Disinflation effects in a medium-scale New Keynesian model: Money supply rule versus interest rate rule,"
European Economic Review,
Elsevier, vol. 61(C), pages 77-100.
- Guido Ascari & Tiziano Ropele, 2012. "Disinflation effects in a medium-scale New Keynesian model: money supply rule versus interest rate rule," Temi di discussione (Economic working papers) 867, Bank of Italy, Economic Research and International Relations Area.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.