Replication data for: Optimal Sticky Prices under Rational Inattention
Principal Investigator(s): View help for Principal Investigator(s) Bartosz Mackowiak; Mirko Wiederholt
Version: View help for Version V1
Name | File Type | Size | Last Modified |
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LICENSE.txt | text/plain | 14.6 KB | 10/12/2019 05:35:AM |
ReadMe.txt | text/plain | 1.6 KB | 10/12/2019 05:35:AM |
bartoszmirko_dec04_fixedpoint2.m | text/x-fortran | 2 KB | 10/12/2019 05:35:AM |
bartoszmirko_jan05_searchforsignals_a.m | text/plain | 104 bytes | 10/12/2019 05:35:AM |
bartoszmirko_july04_IIDsignals_d.m | text/plain | 209 bytes | 10/12/2019 05:35:AM |
bartoszmirko_july04_infoflow_integral.m | text/plain | 366 bytes | 10/12/2019 05:35:AM |
optimal_sticky_prices.m | text/x-fortran | 10.8 KB | 10/12/2019 05:35:AM |
Project Citation:
Mackowiak, Bartosz, and Wiederholt, Mirko. Replication data for: Optimal Sticky Prices under Rational Inattention. Nashville, TN: American Economic Association [publisher], 2009. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-12. https://doi.org/10.3886/E113305V1
Project Description
Summary:
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This paper presents a model in which price setting firms decide what to pay
attention to, subject to a constraint on information flow. When idiosyncratic
conditions are more variable or more important than aggregate conditions,
firms pay more attention to idiosyncratic conditions than to aggregate conditions.
When we calibrate the model to match the large average absolute size of
price changes observed in micro data, prices react fast and by large amounts to
idiosyncratic shocks, but only slowly and by small amounts to nominal shocks.
Nominal shocks have strong and persistent real effects. (JEL D21, D83, E31,
E52)
Scope of Project
JEL Classification:
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D21 Firm Behavior: Theory
D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
E31 Price Level; Inflation; Deflation
E52 Monetary Policy
D21 Firm Behavior: Theory
D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
E31 Price Level; Inflation; Deflation
E52 Monetary Policy
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