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The imperfect-common-knowledge Phillips curve: Calvo versus Rotemberg

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  • Šauer, Radek

Abstract

I derive the imperfect-common-knowledge Phillips curve under the assumption of Rotemberg pricing. The curve differs from the Calvo version in one important aspect. Expectations of future relative prices impact in ation.

Suggested Citation

  • Šauer, Radek, 2016. "The imperfect-common-knowledge Phillips curve: Calvo versus Rotemberg," Discussion Papers 50/2016, Deutsche Bundesbank.
    • Handle: RePEc:zbw:bubdps:502016
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    References listed on IDEAS

    as
    1. Nimark, Kristoffer, 2008. "Dynamic pricing and imperfect common knowledge," Journal of Monetary Economics, Elsevier, vol. 55(2), pages 365-382, March.
    2. Olivier Coibion & Yuriy Gorodnichenko, 2012. "What Can Survey Forecasts Tell Us about Information Rigidities?," Journal of Political Economy, University of Chicago Press, vol. 120(1), pages 116-159.
    3. Andrade, Philippe & Crump, Richard K. & Eusepi, Stefano & Moench, Emanuel, 2016. "Fundamental disagreement," Journal of Monetary Economics, Elsevier, vol. 83(C), pages 106-128.
    4. Leonardo Melosi, 2017. "Signalling Effects of Monetary Policy," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 84(2), pages 853-884.
    5. Calvo, Guillermo A., 1983. "Staggered prices in a utility-maximizing framework," Journal of Monetary Economics, Elsevier, vol. 12(3), pages 383-398, September.
    6. Guido Ascari & Lorenza Rossi, 2012. "Trend Inflation and Firms Price‐Setting: Rotemberg Versus Calvo," Economic Journal, Royal Economic Society, vol. 122(563), pages 1115-1141, September.
    7. Julio J. Rotemberg, 1982. "Monopolistic Price Adjustment and Aggregate Output," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 49(4), pages 517-531.
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    More about this item

    Keywords

    Phillips Curve; Rotemberg; Imperfect Knowledge;
    All these keywords.

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation

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