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Intertemporal Substitution and the Liquidity Effect in a Sticky Price Model Author info | Abstract | Publisher info | Download info | Related research | Statistics Javier Andrés
J. David López-Salido
Javier Vallés
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The liquidity effect, defined as a decrease in nominal interest rates in response to a monetary expansion, is a major stylized fact of the business cycle. This paper seeks to understand under what conditions such an effect can be explained in a general equilibrium model with sticky prices and capital adjustment costs.
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Paper provided by Banco de España in its series Banco de España Working Papers with number
9919.
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Length: 38 pages
Date of creation: 1999Date of revision:
Handle: RePEc:bde:wpaper:9919Contact details of provider: Email: Web page: http://www.bde.es/ More information through EDIRC
For technical questions regarding this item, or to correct its listing, contact: (María D. González. Electronic Dissemination of Information Unit. Research Department. Banco de España).
Keywords: BUSINESS CYCLES ; PRICES ; ECONOMIC MODELS ; GENERAL EQUILIBRIUM ; Other versions of this item:
Find related papers by JEL classification: E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.:
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references Cited by : (explanations , Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.)
Jordi Galí & David López-Salido & Javier Vallés, 2000.
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Jordi Gali & J. David Lopez-Salido & Javier Valles, 2002.
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