Mind the Output Gap: The Disconnect of Growth and Inflation during Recessions and Convex Phillips Curves in the Euro Area
We develop a theoretical model that features a business cycle-dependent relation between output, price inflation and inflation expectations, augmenting the model by Svensson (1997) with a nonlinear Phillips curve that reflects the rationale underlying the capacity constraint theory (Macklem, 1997)....
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Blackwell Publishing Ltd
2019
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| Online Access: | View Fulltext in Publisher |