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A New Keynesian Phillips Curve With Staggered Contracts and Indexation

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  • Olivier Musy

    (LIRAES, Université de Paris)

Abstract

We develop a New Keynesian Phillips curve based on a combination of staggered price contracts and indexation to past inflation. This Phillips curve links current inflation dynamics to past inflation with a positive weight, as well as current and lagged expectations of inflation and output, giving a possible alternative explanation for recent empirical findings on the role of expectations in the determination of inflation

Suggested Citation

  • Olivier Musy, 2021. "A New Keynesian Phillips Curve With Staggered Contracts and Indexation," Economics Bulletin, AccessEcon, vol. 41(1), pages 60-65.
    • Handle: RePEc:ebl:ecbull:eb-20-00185
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    References listed on IDEAS

    as
    1. Steinar Holden & John C. Driscoll, 2003. "Inflation Persistence and Relative Contracting," American Economic Review, American Economic Association, vol. 93(4), pages 1369-1372, September.
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    6. Mohamed Safouane Ben Aïssa & Olivier Musy, 2011. "The Dynamic Properties Of Alternative Assumptions On Price Adjustment In New Keynesian Models," Bulletin of Economic Research, Wiley Blackwell, vol. 63(4), pages 353-384, October.
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    More about this item

    Keywords

    Inflation Dynamics; Staggered contracts; Price Indexation; Sticky Prices; New Keynesian Phillips Curve; Lagged Expectations.;
    All these keywords.

    JEL classification:

    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit

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