Derivation and Estimation of a Phillips Curve with Sticky Prices and Sticky Information

I develop a structural model of inflation by combining two different models of price setting behavior: the sticky price model of the New Keynesian literature and the sticky information model of Mankiw and Reis. In a framework similar to the Calvo model, I assume that there are two types of firms. One type of firm chooses its prices optimally through forward-looking behavior---as assumed in the sticky price model. It uses all available information when deciding on prices. The other type of firm sets its prices under the constraint that the information it uses is ``sticky''---as assumed in the sticky information model. It collects and processes the information necessary to choose its optimal prices with a delay. This leads to the sticky price-sticky information (SP/SI) Phillips curve that nests the standard sticky price and sticky information models. Estimations of this structural model show that both sticky price and sticky information models are statistically and quantitatively important for price setting. However, the sticky price firms make up the majority of the firms in the economy. The resultant SP/SI Phillips curve models inflation better than either the sticky price or sticky information models. The results are robust to alternative sub-samples and estimation methods.Inflation; Phillips Curve; Sticky prices; Sticky information;

Optimal Monetary Policy in the Sticky Information Model of Price Adjustment: Inflation Targeting or Price-Level Targeting?

I investigate optimal monetary policy in the sticky information model of price adjustment within a New Keynesian macroeconomic framework. The model is solved for optimal policy, and welfare implications of three alternative monetary policy regimes: unconstrained policy, price-level targeting and inflation targeting, are compared when there is a shock to the economy. The results for a cost-push shock illustrate that optimal policy depends on the degree of price stickiness and the persistence of the shock. Inflation targeting is the optimal policy if prices are flexible enough or the shock is persistent enough. However, for a demand shock, inflation targeting emerges as the best policy for all values of the price stickiness and the shock's persistence. When the volatility of nominal interest rate is taken into consideration, the results indicate that inflation targeting is the best policy, in the sense that it results in smaller welfare loss and volatility of nominal interest rate, if prices are sticky enough and the persistence of the shock is large enough. However, price-level targeting might be preferable to inflation targeting if prices are more flexible and the relative weight for the volatility of nominal interest rate is large.Optimal policy; Sticky information; Inflation targeting; Price-level targeting

Derivation and Estimation of a Phillips Curve with Sticky Prices and Sticky Information

I develop a structural model of inflation by combining two different models of price setting behavior: the sticky price model of the New Keynesian literature and the sticky information model of Mankiw and Reis. In a framework similar to the Calvo model, I assume that there are two types of firms. One type of firm chooses its prices optimally through forward-looking behavior---as assumed in the sticky price model. It uses all available information when deciding on prices. The other type of firm sets its prices under the constraint that the information it uses is ``sticky''---as assumed in the sticky information model. It collects and processes the information necessary to choose its optimal prices with a delay. This leads to the sticky price-sticky information (SP/SI) Phillips curve that nests the standard sticky price and sticky information models. Estimations of this structural model show that both sticky price and sticky information models are statistically and quantitatively important for price setting. However, the sticky price firms make up the majority of the firms in the economy. The resultant SP/SI Phillips curve models inflation better than either the sticky price or sticky information models. The results are robust to alternative sub-samples and estimation methods

Dynamics of Sticky Information and Sticky Price Models in a New Keynesian DSGE Framework

Recent literature on monetary policy analysis extensively uses the sticky price model of price adjustment in a New Keynesian Macroeconomic framework. This price setting model, however, has been criticized for producing implausible results regarding inflation and output dynamics. This paper examines and compares dynamic responses of the sticky price and sticky information models to a cost-push shock in a New Keynesian DSGE framework. It finds that the sticky information model produces more reasonable dynamics through lagged, gradual and hump-shaped responses to a shock as observed in data. However, these responses depend on the persistence of the shock

Derivation and Estimation of a Phillips Curve with Sticky Prices and Sticky Information

I develop a structural model of inflation by combining two different models of price setting behavior: the sticky price model of the New Keynesian literature and the sticky information model of Mankiw and Reis. In a framework similar to the Calvo model, I assume that there are two types of firms. One type of firm chooses its prices optimally through forward-looking behavior---as assumed in the sticky price model. It uses all available information when deciding on prices. The other type of firm sets its prices under the constraint that the information it uses is ``sticky''---as assumed in the sticky information model. It collects and processes the information necessary to choose its optimal prices with a delay. This leads to the sticky price-sticky information (SP/SI) Phillips curve that nests the standard sticky price and sticky information models. Estimations of this structural model show that both sticky price and sticky information models are statistically and quantitatively important for price setting. However, the sticky price firms make up the majority of the firms in the economy. The resultant SP/SI Phillips curve models inflation better than either the sticky price or sticky information models. The results are robust to alternative sub-samples and estimation methods

Optimal Monetary Policy in the Sticky Information Model of Price Adjustment: Inflation Targeting or Price-Level Targeting?

I investigate optimal monetary policy in the sticky information model of price adjustment within a New Keynesian macroeconomic framework. The model is solved for optimal policy, and welfare implications of three alternative monetary policy regimes: unconstrained policy, price-level targeting and inflation targeting, are compared when there is a shock to the economy. The results for a cost-push shock illustrate that optimal policy depends on the degree of price stickiness and the persistence of the shock. Inflation targeting is the optimal policy if prices are flexible enough or the shock is persistent enough. However, for a demand shock, inflation targeting emerges as the best policy for all values of the price stickiness and the shock's persistence. When the volatility of nominal interest rate is taken into consideration, the results indicate that inflation targeting is the best policy, in the sense that it results in smaller welfare loss and volatility of nominal interest rate, if prices are sticky enough and the persistence of the shock is large enough. However, price-level targeting might be preferable to inflation targeting if prices are more flexible and the relative weight for the volatility of nominal interest rate is large

Dynamics of Sticky Information and Sticky Price Models in a New Keynesian DSGE Framework

Recent literature on monetary policy analysis extensively uses the sticky price model of price adjustment in a New Keynesian Macroeconomic framework. This price setting model, however, has been criticized for producing implausible results regarding inflation and output dynamics. This paper examines and compares dynamic responses of the sticky price and sticky information models to a cost-push shock in a New Keynesian DSGE framework. It finds that the sticky information model produces more reasonable dynamics through lagged, gradual and hump-shaped responses to a shock as observed in data. However, these responses depend on the persistence of the shock

Radar-aided communication scheduling algorithm for 5G and beyond networks

Radar and communication coexistence is an upcoming technology with numerous research opportunities in the medium access control (MAC) layer, particularly in scheduling and radio resource management (RRM). More efficient scheduling algorithms are needed with the wide range of applications that the wireless environment is experiencing. We investigate an echo-based scenario in the radar-aided vehicular communication system in which an echo is reflected from a target. Unlike the conventional scheduling mechanisms where signal-to-interference-plus-noise ratio (SINR) is exploited, this paper proposes a new radar-aided communication scheduling algorithm by utilizing parameters such as range and velocity with the classical SINR measurements. The proposed algorithm schedules the available resources by extracting information from the radar echo. The proposed radar-aided communication scheduling scheme provides a more flexible design by adding new parameters, resulting in a more efficient algorithm in a broad variety of scenarios. The proposed scheme is beneficial for B5G communication systems that allow localization and sensing as key features of next-generation wireless networks

Respiratory findings in gun factory workers exposed to solvents

AbstractObjective: Gun factory workers are exposed to many solvents (toluene, acetone, butanol, xylene, benzene, trichloroethylene). We investigated whether chronic exposure to solvents had adverse effect on respiratory system.Material and methods: The workers were questionnaired by modified Medical Research Council's respiratory questionnaire before morning start shift. Then physical examination and measurement of pulmonary functions by portable dry rolling spirometer were performed. The study group consisted of 1091 gun factory workers. The workers were grouped according to their smoking habits (smokers, [exposed n: 353 vs. unexposed n: 339] and non-smokers [exposed n: 58 vs. unexposed n: 341]). Asthma-related symptoms were defined as either definite asthma, probable asthma, and possible asthma.Results: In non-smokers, the report of asthma-related symptoms was more prevalent in exposed workers than unexposed (39.7% vs. 21.7% OR 2.4[1.3–4.3], respectively P=0.003). In smokers, the report of asthma-related symptoms was more common in exposed group than unexposed (50.7% vs. 42.5% OR 1.4[1.0–1.9], respectively P=0.03). Logistic regression analysis showed that smoking (OR 2.8 [2.0–3.8] P=0.00001) and exposure to solvents (OR 1.4[1.1–1.9] P=0.01) were independent risk factors for asthma-related symptoms, after adjusting for age. Logistic regression analysis identified that smoking (OR 3.3[2.3–4.6] P=0.00001) was independent risk factors for chronic bronchitis. Multiple linear regression analysis of lung-function parameters (% forced expiratory volume (FEV1), FEV1/forced vital capacity, FEF25–75) indicated significant effects of smoking.Conclusion: Present study indicated significant effects of smoking and exposure to solvents, with the smoking effect being the most important on asthma-related symptoms of gun factory workers