Implications of Food Subsistence for Monetary Policy and Inflation is popular PDF and ePub book, written by Rafael Portillo in 2016-03-17, it is a fantastic choice for those who relish reading online the Business & Economics genre. Let's immerse ourselves in this engaging Business & Economics book by exploring the summary and details provided below. Remember, Implications of Food Subsistence for Monetary Policy and Inflation can be Read Online from any device for your convenience.
Implications of Food Subsistence for Monetary Policy and Inflation Book PDF Summary
We introduce subsistence requirements in food consumption into a simple new-Keynesian model with flexible food and sticky non-food prices. We study how the endogenous structural transformation that results from subsistence affects the dynamics of the economy, the design of monetary policy, and the properties of inflation at different levels of development. A calibrated version of the model encompasses both rich and poor countries and broadly replicates the properties of inflation across the development spectrum, including the dominant role played by changes in the relative price of food in poor countries. We derive a welfare-based loss function for the monetary authority and show that optimal policy calls for complete (in some cases nearcomplete) stabilization of sticky-price non-food inflation, despite the presence of a foodsubsistence threshold. Subsistence amplifies the welfare losses of policy mistakes, however, raising the stakes for monetary policy at earlier stages of development.
Detail Book of Implications of Food Subsistence for Monetary Policy and Inflation PDF
- Author : Rafael Portillo
- Release : 17 March 2016
- Publisher : International Monetary Fund
- ISBN : 9781475542639
- Genre : Business & Economics
- Total Page : 62 pages
- Language : English
- PDF File Size : 8,7 Mb
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