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A Detailed Derivation of the Sticky Price and Sticky Information New Keynesian DSGE Model

Author

Listed:
  • Jan-Oliver Menz

    () (Department for Economics and Politics, University of Hamburg)

  • Lena Vogel

    () (Department for Economics and Politics, University of Hamburg)

Abstract

This paper aims at providing macroeconomists with a detailed exposition of the New Keynesian DSGE model. Both the sticky price version and the sticky information variant are derived mathematically. Moreover, we simulate the models, also including lagged terms in the sticky price version, and compare the implied impulse response functions. Finally, we present solution methods for DSGE models, and discuss three important theoretical assumptions.

Suggested Citation

  • Jan-Oliver Menz & Lena Vogel, 2009. "A Detailed Derivation of the Sticky Price and Sticky Information New Keynesian DSGE Model," Macroeconomics and Finance Series 200902, Hamburg University, Department Wirtschaft und Politik.
  • Handle: RePEc:hep:macppr:200902
    as

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    File URL: https://www.wiso.uni-hamburg.de/repec/hepdoc/macppr_2_2009.pdf
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Hübner, Malte & Vannoorenberghe, Gonzague, 2015. "Patience and Inflation," MPRA Paper 65811, University Library of Munich, Germany.
    2. Lahcen, Mohammed Ait, 2014. "DSGE models for developing economies: an application to Morocco," MPRA Paper 63404, University Library of Munich, Germany.
    3. Carlos E. Posada & Alfredo Villca, 2017. "¿Es conveniente una autoridad monetaria “blanda”?," DOCUMENTOS DE TRABAJO CIEF 015673, UNIVERSIDAD EAFIT.

    More about this item

    Keywords

    New Keynesian Model; Sticky Prices; Sticky Information; Solution Algorithms;

    JEL classification:

    • E0 - Macroeconomics and Monetary Economics - - General
    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques

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