Permanent and temporary inflation uncertainty and investment in the United States

Joseph P. Byrne*, E.Philip Davis

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

38 Citations (Scopus)

Abstract

We estimate the impact on US non-residential fixed investment of permanent and temporary inflation uncertainty. We find that while both have a negative effect, temporary uncertainty is more important for investment. This study has implications for monetary policy and applied-econometric practice.

Original languageEnglish
Pages (from-to)271-277
Number of pages7
JournalEconomics Letters
Volume85
Issue number2
Early online date9 Aug 2004
DOIs
Publication statusPublished - 30 Nov 2004

Keywords

  • investment
  • Markov switching
  • permanent and temporary uncertainty

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