This paper studies the dynamic properties of a standard cash-in-advance model modified to include habit persistence over preferences. The central bank is assumed to follow an exogenous money growth rule. We show that equilibrium real indeterminacy is more likely to occur when habit persistence...

We develop a structural model that aims at characterizing a set of restrictions allowing for a statistical evaluation of the effect of changes in monetary policy rules on aggregate dynamics at business cycle frequency. Standard econometric tools are first used to reveal and estimate changes in...

The present paper investigates the dynamic effects of disinflation shocks for a number of real macroeconomic variables in the euro area. Using structural VARs, we identify disinflation shocks as the only shocks that can exert a long—run effect on inflation as well as other nominal variables...