Replication data for: Sticky Prices versus Monetary Frictions: An Estimation of Policy Trade-Offs

Principal Investigator(s):  View help for Principal Investigator(s) S. Borağan Aruoba; Frank Schorfheide

Version:  View help for Version V1

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  AEJMacro-20090177_data 10/12/2019 09:05:PM
LICENSE.txt text/plain 14.6 KB 10/12/2019 05:05:PM

Project Citation: 

Aruoba, S. Boragan, and Schorfheide, Frank. Replication data for: Sticky Prices versus Monetary Frictions: An Estimation of Policy Trade-Offs. Nashville, TN: American Economic Association [publisher], 2011. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-12. https://doi.org/10.3886/E114193V1

Project Description

Summary:  View help for Summary We develop a two-sector monetary model with a centralized and decentralized market. Activities in the centralized market resemble those in a standard New Keynesian economy with price rigidities. In the decentralized market agents engage in bilateral exchanges for which money is essential. This paper is the first to formally estimate such a model, evaluate its fit based on postwar US data, and assess its money demand properties. Steady-state welfare calculations reveal that the distortions created by the monetary friction may be of similar magnitude as the distortions created by the New Keynesian friction. (JEL C54, E12, E31, E41, E52)

Scope of Project

JEL Classification:  View help for JEL Classification
      C54 Quantitative Policy Modeling
      E12 General Aggregative Models: Keynes; Keynesian; Post-Keynesian; Modern Monetary Theory
      E31 Price Level; Inflation; Deflation
      E41 Demand for Money
      E52 Monetary Policy


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V1 [2019-10-12]

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