A Dynamic Economy with Costly Price Adjustments
构建了一个包含菜单成本的一般均衡模型，分析企业面对生产率和货币冲击时的最优定价策略，并考察价格指数、总产出动态以及不确定性的福利影响。
This paper studies a general-equilibrium model of a dynamic economy with menu costs. Each firm's productivity is exposed to idiosyncratic and aggregate productivity shocks around a trend, and the money supply to monetary shocks around a trend. All consumption, pricing, and production decisions are based on optimizing behavior. There exists a staggered Markov perfect equilibrium with prices determined by a two-sided (s, S) markup strategy. The paper analyzes the optimal markup strategy and investigates the dynamics of the price index and the aggregate output. The welfare consequences of the uncertain aggregate productivity and money supply are also examined.