Nominalschub

Nominalschub is a term encountered in economic discourse, particularly in German-language literature, to describe a shock or policy action that raises nominal variables such as the price level, wages, or the money supply without an immediate, proportional rise in real output.

Etymology and scope: The term combines nominal, indicating face value, with Schub, meaning boost or push.

Definition and scope: In macroeconomic analysis, nominal shocks alter nominal aggregates while real variables—such as real GDP, employment, or physical output—remain unchanged in the short run, typically because prices or wages are sticky. The effect is often temporary: as inflation expectations adjust or relative prices adjust, some of the observed nominal changes may translate into real effects later, depending on the degree of price rigidity and policy credibility.

Mechanisms and examples: A central bank's expansionary policy that increases the money supply can produce a nominal boost to the price level or nominal GDP while real GDP grows slowly or not at all in the short term. A sudden devaluation or a wage-price spiral can similarly elevate nominal wages or prices without immediate gains in real goods.

Implications: Analysts distinguish nominal shocks from real shocks when attributing macroeconomic movements. The policy relevance centers on whether nominal changes erode or enhance purchasing power, affect debt burdens, or influence expectations and therefore real activity over time.

See also: nominal GDP, inflation, monetary policy, price level, real GDP, price rigidity.