Title: The hybrid Phillips curve formula for DSGE models with a finite number of firms
Authors: Pawel Zajac - AGH University of Science and Technology (Poland) [presenting]
Abstract: In recent years DSGE models, which assume the existence of a finite number of agents on the market, are becoming more and more popular. In particular this modeling approach allows the possibility of default in the equilibrium state. In result, these models are used as a tool to analyze the relationship between macroeconomic variables and business demography in the economy. A common practice while constructing DSGE models is to use an equation describing inflation. A hybrid variant of the new Keynesian Phillips curve is often applied to realize this purpose. The hybrid Phillips curve for DSGE Models with a finite number of firms is being developed.