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An Optimization-Based Econometric Framework for the Evaluation of Monetary Policy
This paper considers a simple quantitative model of output, interest rate and inflation determination in the United States, and uses it to evaluate alternative rules by which the Fed may set interest
Sticky Prices in the United States
  • J. Rotemberg
  • Economics
    Journal of Political Economy
  • 1 December 1982
It has often been argued that prices are sticky in the United States. However, the empirical papers that have claimed to support this view have not reflected any formal behavioral theory. This paper
A Supergame-Theoretic Model of Price Wars during Booms
This paper studies implicitly colluding oligopolists facing fluctuatingdemand. The credible threat of future punishments provides the discipline that facilitates collusion. However, the authors find
Monopolistic Price Adjustment and Aggregate Output
This paper studies the consequences for the behaviour of aggregate output of the perception on the part of firms that changing prices is costly. The rational expectations equilibrium of an economy
Interest-Rate Rules in an Estimated Sticky Price Model
This paper evaluates alternative rules by which the Fed may set interest rates using the small model of the U.S. economy estimated in Rotemberg and Woodford (1997). Our main substantive finding is
The Cyclical Behavior of Prices and Costs
Because inputs are scarce, marginal cost should be an increasing function of output. Without changes in this real marginal cost schedule, aggregate output can vary if and only if the markup of price
An Optimization-Based Econometric Framework for the Evaluation of Monetary Policy: Expanded Version
This paper considers a simple quantitative model of output, interest rate and inflation determination in the United States, and uses it to evaluate alternative rules by which the Fed may set interest
Oligopolistic Pricing and the Effects of Aggregate Demand on Economic Activity
We construct a dynamic general equilibrium model in which the typical industry colludes by threatening to punish deviations from an implicitly agreed-on pricing path. We use methods similar to those
The Excess Co-Movement of Commodity Prices
This paper tests and confirms the existence of a puzzling phenomenon - the prices of largely unrelated raw commodities have a persistent tendency to move together. We show that this comovement of
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