Investment price rigidity and business cycles
This paper incorporates sticky investment prices in a two-sector monetary model of business cycles. Fit to quarterly U.S. time series, the model suggests that price rigidity in the investment sector is the single most empirically relevant friction to match the data. Sticky investment prices are also important to understand the dynamic effects of technology shocks and their pass-through to the relative price of investment goods.
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.:
- Joel Wagner, 2015. "The Endogenous Relative Price of Investment," Staff Working Papers 15-30, Bank of Canada.
- Beaudry, Paul & Moura, Alban & Portier, Franck, 2015.
"Reexamining the cyclical behavior of the relative price of investment,"
Elsevier, vol. 135(C), pages 108-111.
- Paul Beaudry & Alban Moura & Franck Portier, 2014. "Reexamining the Cyclical Behavior of the Relative Price of Investment," NBER Working Papers 20550, National Bureau of Economic Research, Inc.
- Beaudry, Paul & Moura, Alban & Portier, Franck, 2014. "Reexamining the Cyclical Behavior of the Relative Price of Investment," CEPR Discussion Papers 10128, C.E.P.R. Discussion Papers.
- Kim, Jinill, 2003. "Functional equivalence between intertemporal and multisectoral investment adjustment costs," Journal of Economic Dynamics and Control, Elsevier, vol. 27(4), pages 533-549, February.
- Alain Gabler, 2014. "Relative Price Fluctuations in a Two-Sector Model with Imperfect Competition," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 17(3), pages 474-483, July.
- Alain Gabler, 2013. "Code and data files for "Relative Price Fluctuations in a Multi-Sector Model with Imperfect Competition"," Computer Codes 10-165, Review of Economic Dynamics.
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