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Une évaluation structurelle du ratio de sacrifice dans la zone euro

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  • Coffinet, J.
  • Matheron, J.
  • Poilly , C.

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.

Suggested Citation

  • Coffinet, J. & Matheron, J. & Poilly , C., 2007. "Une évaluation structurelle du ratio de sacrifice dans la zone euro," Working papers 163, Banque de France.
  • Handle: RePEc:bfr:banfra:163
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    References listed on IDEAS

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    Cited by:

    1. International Monetary Fund, 2007. "Euro Area Policies; Selected Issues," IMF Staff Country Reports 07/259, International Monetary Fund.

    More about this item

    Keywords

    Sacrifice ratio ; Sticky prices and sticky wages ; DSGE model.;

    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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