Working papers

Temporary sales and cyclicality
by Flora Budianto

2023 (August)
The paper provides novel evidence from micro price data that temporary sales are used strategically to implement regular price changes over the business cycle.

Social learning expectations: micro-foundations and a Dynare toolbox
by Alex Grimaud, Isabelle Salle and Gauthier Vermandel

2023 (May)
This paper introduces (i) a micro-founded New Keynesian model with social learning expectations and (ii) a general solution method that we implement in a Dynare toolbox that solves any linear state-space model with social learning expectations.

Unemployment risk and temporary UI benefits increases
by Alex Grimaud

2022 (June)
The welfare implications of increasing government spending in general, and UI transfers in particular, are very dependent on the state of the labor market.

The Euro Area government spending multiplier in demand- and supply-driven recessions
by Mario Di Serio, Matteo Fragetta, Emanuel Gasteiger and Giovanni Melina

2022 (updated, July 2023)
Euro Area government spending multipliers in a demand-driven recession are 2-3 times larger than in a supply-driven recession.

Precautionary saving and un-anchored expectations
by Alex Grimaud

2020 (updated, December 2021)
In a monetary policy model with idiosyncratic shocks and bounded rational expectations, output stabilization is essential.

Inflation targets and the zero lower bound
by Flora Budianto

2019 (updated, January 2023)
A higher inflation target leads to more volatile inflation and can, therefore, increase the risk of hitting the interest rate lower bound.

Endogenously (non-)Ricardian beliefs
by Emanuel Gasteiger and William Branch

2018 (updated, December 2023)
A paper on multiple equilibria featuring both Ricardian and non-Ricardian outcomes impact inflation dynamics. Bayesian model estimates suggest: 1970’s and 2021-22 are periods of non-Ricardian beliefs and inflation. Disinflation is a self-fulfilling and temporary escape from a non-Ricardian belief equilibrium.

Journal articles

Social learning and monetary policy at the effective lower bound
by Jasmina Arifovic, Alex Grimaud, Isabelle Salle and Gauthier Vermandel

2023. Journal of Money, Credit and Banking, forthoming.

Price setting frequency and the Phillips curve
by Emanuel Gasteiger and Alex Grimaud

2023. European Economic Review, 158(C):104535.

Average inflation targeting and the interest rate lower bound
by Flora Budianto, Taisuke Nakata, and Sebastian Schmidt

2023. European Economic Review, 152(C):104384.

Optimal constrained interest-rate rules under heterogeneous expectations
by Emanuel Gasteiger

2021. Journal of Economic Behavior and Organization, 190:287-325.