Munich Personal RePEc Archive

Note on nominal rigidities and news-driven business cycles

Nutahara, Kengo (2010): Note on nominal rigidities and news-driven business cycles.

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Abstract

A news-driven business cycle is a positive comovement of consumption, output, labor, and investment from the news about the future. We show that nominal rigidities, especially sticky prices, can cause it in an estimated medium-scale DSGE economy.

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