Cole, Stephen J.; Martínez-García, Enrique; Sims, Eric R. - National Bureau of Economic Research - 2023
expectations. In our model, the key parameter that aggregates heterogeneous expectations captures the central bank's credibility …'s central bank credibility is much lower. For each country, our measure of credibility has declined over time, making forward … public perceived central bank forward guidance statements to be perfectly credible. Moreover, inflation would have declined …