Series: IMF Working Papers
Author(s): Muneesh Kapur , and Michael Patra
Publisher: INTERNATIONAL MONETARY FUND
Publication Date: 01 August 2010
Keywords: IS Curve, Monetary Transmission, Neutral Interest Rate, New Keynesian Model, Phillips Curve, inflation, aggregate demand, real interest rate, monetary policy reaction function, Open Economy Macroeconomics,
A New Keynesian model estimated for India yields valuable insights. Aggregate demand reacts to interest rate changes with a lag of at least three quarters, with inflation taking seven quarters to respond. Inflation...