TY  - UNPD
A1  - Coenen, Günter
A1  - Wieland, Volker
T1  - A small estimated Euro area model with rational expectations and nominal rigidities
T2  - Center for Financial Studies (Frankfurt am Main): CFS working paper series ; No. 2003,08
N2  - In this paper we estimate a small model of the euro area to be used as a laboratory for evaluating the performance of alternative monetary policy strategies. We start with the relationship between output and inflation and investigate the fit of the nominal wage contracting model due to Taylor (1980)and three different versions of the relative real wage contracting model proposed by Buiter and Jewitt (1981)and estimated by Fuhrer and Moore (1995a) for the United States. While Fuhrer and Moore reject the nominal contracting model in favor of the relative contracting model which induces more inflation persistence, we find that both models fit euro area data reasonably well. When considering France, Germany and Italy separately, however, we find that the nominal contracting model fits German data better, while the relative contracting model does quite well in countries which transitioned out of a high inflation regime such as France and Italy. We close the model by estimating an aggregate demand relationship and investigate the consequences of the different wage contracting specifications for the inflation-output variability tradeoff, when interest rates are set according to Taylor 's rule.
T3  - CFS working paper series - 2003, 08 
KW  - European Monetary Union
KW  - euro area
KW  - macroeconomic modelling
KW  - rational expectations
KW  - nominal rigidities
KW  - overlapping wage contracts
KW  - Europäische Union
KW  - Makroökonomisches Modell
KW  - Geldpolitik
KW  - Mitgliedsstaaten
KW  - Währungsunion
Y1  - 2003
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/4482
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30-10146
ER  -