Nakata, Taisuke; Sunakawa, Takeki - 2019 - This draft: April 2019
We analyze credible forward guidance policies in a sticky-price model with an effective lower bound (ELB) constraint on …. Lower-for-longer policies --- while effective in stimulating the economy at the ELB --- are potentially time … a lower-for-longer promise leads to a loss of reputation and prevents the central bank from effectively using lower …