Global Relative Price Shocks: The Role of Macroeconomic Policies
We use the multi-sector and multi-country G-Cubed model to explore the potential role of three major shocks � to productivity, risk premia and US monetary policy � to explain the large movements in relative prices between 2002 and 2008. We find that productivity shocks were major drivers of relative price movements, while shocks to risk premia and US monetary policy contributed temporarily to some of the relative price dispersions we observe in the data. The effect of US monetary policy shocks...[Show more]
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|Source:||Inflation in an Era of Relative Price Shocks|
|01_Cagliarini_Global_Relative_Price_Shocks:_2010.pdf||2.49 MB||Adobe PDF||Request a copy|
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