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FEDS 2018-058: Oil, Equities, and the Zero Lower Bound

September 2, 2018 Bilal 0

FEDS 2018-058: Oil, Equities, and the Zero Lower Bound https://ift.tt/2OGYbpC FEDS 2018-062 August 2018 Abstract: The Phillips curve has been much flatter in the past twenty years than in the preceding decades. We consider two hypotheses. One is that prices at the microeconomic level are stickier than they used to be—in the context of the canonical Calvo model, firms are adjusting prices less often. The other is that the expectations of firms and households about future inflation are now less well informed by macroeconomic conditions; because expectations are important in the setting of current-period prices, inflation is therefore less sensitive […]