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Micro Jumps, Macro Humps: Monetary Policy and Business Cycles in an Estimated HANK Model / Adrien Auclert, Matthew Rognlie, Ludwig Straub.
- Format:
- Book
- Author/Creator:
- Auclert, Adrien.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w26647.
- NBER working paper series no. w26647
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Other Title:
- Micro Jumps, Macro Humps
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2020.
- Summary:
- We estimate a Heterogeneous-Agent New Keynesian model with sticky household expectations that matches existing microeconomic evidence on marginal propensities to consume and macroeconomic evidence on the impulse response to a monetary policy shock. Our estimated model uncovers a central role for investment in the transmission mechanism of monetary policy, as high MPCs amplify the investment response in the data. This force also generates a procyclical response of consumption to investment shocks, leading our model to infer a central role for these shocks as a source of business cycles.
- Notes:
- Print version record
- January 2020.
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