The Output Effect of a Transition to Price Stability When Velocity Is Time Varying
研究货币流通速度随时间变化如何影响降低通胀政策的产出反应，发现即使政策完全可信，通胀下降也可能导致产出损失比以往认为的更大。
This paper explores the effect of time‐varying velocity on output responses to policies for reducing/stopping inflation. We study a dynamic general equilibrium model with sticky prices in which we introduce time‐varying velocity. Specifically, we endogenize time‐varying velocity into the model developed by Ireland (1997) for analyzing optimal disinflation. The nonlinear solution method reveals that, depending on velocity, the “disinflationary boom” found by Ball (1994) may disappear even under perfect credibility and that early output losses may be much larger than previously thought. Indeed, we find that a gradual disinflation from a low inflation may even be undesirable.