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• W1511291839 abstract "This paper introduces heterogeneous households into an otherwise standard sticky-price model with industry-specific labor markets. Households differ in labor incomes and asset markets are incomplete. I show that household heterogeneity affects equilibrium dynamics nontrivially by amplifying price stickiness endogenously through wealth effects on labor supply. To quantify the importance of household heterogeneity in amplifying stickiness, I estimate and compare representative and heterogeneous household models. The quantitative exercise shows the heterogenous household model performs better than its representative counterpart in accounting for aggregate and sectoral dynamics in the U.S., while being more consistent with empirical evidence on nominal rigidity at the aggregate and sectoral levels, thanks to the stickiness endoge" @default.
• W1511291839 created "2016-06-24" @default.
• W1511291839 creator A5009084505 @default.
• W1511291839 date "2008-01-01" @default.
• W1511291839 modified "2023-09-27" @default.
• W1511291839 title "Heterogeneous households in a sticky price DSGE model" @default.
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• W1511291839 hasPublicationYear "2008" @default.
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