Does Money Illusion Matter? Reply

Ernst Fehr; Jean-Robert Tyran

doi:10.1257/aer.104.3.1063

Does Money Illusion Matter? Reply

Ernst Fehr
, Jean-Robert Tyran

Veröffentlichungen: Beitrag in Fachzeitschrift › Artikel › Peer Reviewed

Abstract

The data in Fehr and Tyran (2001) and Petersen and Winn (2014) show that money illusion plays an important role in nominal price adjustment after a fully anticipated negative monetary shock. Money illusion affects subjects' expectations, and causes pronounced nominal inertia after a negative shock but much less inertia after a positive shock. Thus Petersen and Winn (2014) provide a misleading interpretation of both our and their own data. (JEL C92, D83, D84, E31, E32, E52).

Originalsprache	Englisch
Seiten (von - bis)	1063-1071
Seitenumfang	9
Fachzeitschrift	The American Economic Review (Print Edition)
Jahrgang	104
Ausgabenummer	3
DOIs	https://doi.org/10.1257/aer.104.3.1063
Publikationsstatus	Veröffentlicht - März 2014

ÖFOS 2012

502053 Volkswirtschaftslehre

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10.1257/aer.104.3.1063

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Does Money Illusion Matter? Reply

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