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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 interestExpand
  • 2,152
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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 paperExpand
  • 1,563
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  • PDF
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 findExpand
  • 1,360
  • 94
  • PDF
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 economyExpand
  • 699
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  • PDF
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 isExpand
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  • 72
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 priceExpand
  • 718
  • 61
  • PDF
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 thoseExpand
  • 733
  • 54
  • PDF
Markups and the Business Cycle
As output and employment rise in business cycle booms, the marginal product of labor falls while real wages generally do not. So marginal cost, which equals the wage divided by the marginal productExpand
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