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Une évaluation structurelle du ratio de sacrifice dans la zone euro

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Author Info
Coffinet, J.
Matheron, J.
Poilly , C.

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Abstract

In this paper, we seek to estimate the sacrifice ratio of the euro area using a small DSGE model where prices and wages are sticky. We estimate model's parameters so as to minimize the distance between VAR-based and model-based covariances of a set of variables. The estimated value of the sacrifice ratio reaches 1.30%. In a second step, we proceed to a set of counterfactual exercises in order to highlight the link between the sacrifice ratio and the degree of prices and wages stickiness. We obtain that a decrease of prices stickiness does not necessary result in a decrease of the sacrifice ratio. In addition, the sacrifice ratio rises with the degree of wage stickiness.

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Publisher Info
Paper provided by Banque de France in its series Documents de Travail with number 163.

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Length: 39 pages
Date of creation: 2007
Date of revision:
Handle: RePEc:bfr:banfra:163

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Related research
Keywords: Sacrifice ratio ; Sticky prices and sticky wages ; DSGE model.;

Find related papers by JEL classification:
E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation

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