@techreport{NBERw11034,
 title = "Firm-Specific Capital, Nominal Rigidities and the Business Cycle",
 author = "David Altig and Lawrence Christiano and Martin Eichenbaum and Jesper Linde",
 institution = "National Bureau of Economic Research",
 type = "Working Paper",
 series = "Working Paper Series",
 number = "11034",
 year = "2005",
 month = "January",
 URL = "http://www.nber.org/papers/w11034",
 abstract = {Macroeconomic and microeconomic data paint conflicting pictures of price behavior. Macroeconomic data suggest that inflation is inertial. Microeconomic data indicate that firms change prices frequently. We formulate and estimate a model which resolves this apparent micro - macro conflict. Our model is consistent with post-war U.S. evidence on inflation inertia even though firms re-optimize prices on average once every 1.5 quarters. The key feature of our model is that capital is firm-specific and pre-determined within a period.},
}