Monetary Policy and the Relative Price of Durable Goods /

In a SVAR model of the US, the response of the relative price of durables to a monetary contraction is either flat or mildly positive. It significantly falls only if narrowly defined as the ratio between new-house and nondurables prices. These findings are rationalized via the estimation of a two-se...

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Bibliographische Detailangaben
1. Verfasser: Cantelmo, Alessandro
Weitere Verfasser: Melina, Giovanni
Format: Zeitschrift
Sprache:English
Veröffentlicht: Washington, D.C. : International Monetary Fund, 2017.
Schriftenreihe:IMF Working Papers; Working Paper ; No. 2017/290
Online Zugang:Full text available on IMF
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245 1 0 |a Monetary Policy and the Relative Price of Durable Goods /  |c Alessandro Cantelmo, Giovanni Melina. 
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520 3 |a In a SVAR model of the US, the response of the relative price of durables to a monetary contraction is either flat or mildly positive. It significantly falls only if narrowly defined as the ratio between new-house and nondurables prices. These findings are rationalized via the estimation of a two-sector New-Keynesian (NK) models. Durables prices are estimated to be as sticky as nondurables, leading to a flat relative price response to a monetary shock. Conversely, house prices are estimated to be almost flexible. Such results survive several robustness checks and a three-sector extension of the NK model. These findings have implications for building two-sector NK models with durable and nondurable goods, and for the conduct of monetary policy. 
538 |a Mode of access: Internet 
700 1 |a Melina, Giovanni. 
830 0 |a IMF Working Papers; Working Paper ;  |v No. 2017/290 
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