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| Guido Ascari and Nicola Branzoli |
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| ''The long-run optimal degree of indexation in new Keynesian models with price staggering à la Calvo'' |
| ( 2010, Vol. 30 No.1 ) |
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| This note shows that full price indexation is not optimal in the long-run, in the New Keynesian model under trend inflation and price staggering à la Calvo. Moreover, we show that more price stickiness may increase steady state welfare, if price indexation is partial. |
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| Keywords: Indexation, Trend Inflation, New Keynesian model |
JEL: E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit: General
E3 - Prices, Business Fluctuations, and Cycles: General (includes Measurement and Data) |
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| Manuscript Received : Sep 10 2009 | | Manuscript Accepted : Feb 08 2010 |
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