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Teles, Pedro; Uhlig, Harald - C.E.P.R. Discussion Papers - 2010

countries with low inflation, the raw relationship between average inflation and the growth rate of money is tenuous at best … elasticities implied by theories of Baumol-Tobin and Miller-Orr. Finally, the sample after 1990 shows considerably less inflation … variability, worsening the fit of a one-for-one relationship between money growth and inflation, and generates a fairly low …

Persistent link: https://www.econbiz.de/10008682890

Globalization and Monetary Control

Woodford, Michael - C.E.P.R. Discussion Papers - 2007

central banks to control inflation within their borders, at least in the absence of coordination of policy with other central … the ability of monetary policy to control inflation: by making liquidity premia a function of 'global liquidity' rather … to control the dynamics of inflation. …

Persistent link: https://www.econbiz.de/10005662247

Optimal Fiscal and Monetary Policy: Equivalence Results

Correia, Isabel; Nicolini, Juan Pablo; Teles, Pedro - C.E.P.R. Discussion Papers - 2003

In this Paper, we analyse the implications of price setting restrictions for the conduct of cyclical fiscal and monetary policy. We consider an environment with monopolistic competitive firms, a shopping time technology, prices set one period in advance, and government expenditures that must be...

Persistent link: https://www.econbiz.de/10005504488

Unconventional Fiscal Policy at the Zero Bound

Correia, Isabel; Farhi, Emmanuel; Nicolini, Juan Pablo; … - C.E.P.R. Discussion Papers - 2011

When the zero lower bound on nominal interest rates binds, monetary policy cannot provide appropriate stimulus. We show that in the standard New Keynesian model, tax policy can deliver such stimulus at no cost and in a time-consistent manner. There is no need to use inefficient policies such as...

Persistent link: https://www.econbiz.de/10008854460

Credit Spreads and Credit Policies

Correia, Isabel; De Fiore, Fiorella; Teles, Pedro; … - C.E.P.R. Discussion Papers - 2014

How should monetary and fiscal policy react to adverse financial shocks? If monetary policy is constrained by the zero lower bound on the nominal interest rate, subsidising the interest rate on loans is the optimal policy. The subsidies can mimic movements in the interest rate and can therefore...

Persistent link: https://www.econbiz.de/10011083684

Monetary Policy with Single Instrument Feedback Rules

Adão, Bernardino; Correia, Isabel; Teles, Pedro - C.E.P.R. Discussion Papers - 2005

We consider standard cash-in-advance monetary models and show that there are interest rate or money supply rules such that equilibria are unique. The existence of these single instrument rules depends on whether the economy has an infinite horizon or an arbitrarily large but finite horizon.

Persistent link: https://www.econbiz.de/10005661665

International Dimensions of Optimal Monetary Policy

Corsetti, Giancarlo; Pesenti, Paolo - C.E.P.R. Discussion Papers - 2002

This Paper provides a baseline general-equilibrium model of optimal monetary policy among interdependent economies with monopolistic firms and nominal rigidities. An inward-looking policy of complete domestic output stabilization is not optimal when firms' markups are exposed to currency...

Persistent link: https://www.econbiz.de/10005662226

Openness and the Case for Flexible Exchange Rates

Corsetti, Giancarlo - C.E.P.R. Discussion Papers - 2006

Models of stabilization in open economy traditionally emphasize the role of exchange rates as a substitute for nominal price flexibility in fostering relative price adjustment. This view has been recently criticized on the ground that, to the extent that prices are sticky in local currency, the...

Persistent link: https://www.econbiz.de/10005114386

The Simple Geometry of Transmission and Stabilization in Closed and Open Economies

Corsetti, Giancarlo; Pesenti, Paolo - C.E.P.R. Discussion Papers - 2005

This paper provides an introduction to the recent literature on macroeconomic stabilization in closed and open economies. We present a stylized theoretical framework, and illustrate its main properties with the help of an intuitive graphical apparatus. Among the issues we discuss: optimal...

Persistent link: https://www.econbiz.de/10005114457

Delegating Optimal Monetary Policy Inertia

Bilbiie, Florin Ovidiu - C.E.P.R. Discussion Papers - 2009

regimes that are nested within this framework: inflation, output-gap growth and nominal income growth targeting; and inflation …

Persistent link: https://www.econbiz.de/10008459765

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