The New-Keynesian approach to DSGE models extended the RBC literature by introducing rigidities in price and wage setting. Rotemberg and Woodford (1997) were the .rst to introduce such a framework. The synthesis of New-Keynesian and RBC models proved to be successful in terms of matching economic theory to empirical evidence. For example, the idea of sticky prices broke down the neutrality of money hypothesis, giving a new dimension and life to the usefulness of monetary policy. Despite all the progress,these models failed to generate persistence of monetary policy shocks [Chariet al., (1998)], which led to the emergence of a large literature [see for example Andersen (1998), Huang and Liu (2002), and Edge (2002)] in order to develop an alternative approach. With the passage of time a wider set of possible assumptions were introduced into DSGE models. For example, .nancial sector rigidities (Christensen and Dib, 2008), asymmetric information (Collard and Dellas, 2004), habit persistence in consumption (Fuhrer, 2000), adjustment costs in investment and variable capital utilization (Smets and Wouters, 2003 and 2005), and customer holdup effects (Aksoy et al., 2009).