01741cas a2200241 a 4500 AALejournalIMF011755 230101c9999 xx r poo 0 0eng d 5.00 USD 9781475502350 1018-5941 BD-DhAAL BD-DhAAL Khramov, Vadim. Assessing Dsge Models with Capital Accumulation and Indeterminacy / Vadim Khramov. Washington, D.C. : International Monetary Fund, 2012. 1 online resource (35 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students The simulated results of this paper show that New Keynesian DSGE models with capital accumulation can generate substantial persistencies in the dynamics of the main economic variables, due to the stock nature of capital. Empirical estimates on U.S. data from 1960:I to 2008:I show the response of monetary policy to inflation was almost twice lower than traditionally considered, as capital accumulation creates an additional channel of influence through real interest rates in the production sector. Versions of the model with indeterminacy empirically outperform determinate versions. This paper allows for the reconsideration of previous findings and has significant monetary policy implications. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2012/083 Full text available on IMF http://elibrary.imf.org/view/journals/001/2012/083/001.2012.issue-083-en.xml IMF e-Library