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recognition to the intertemporal nature of households' saving decisions. Like traditional IS-LM, however, the optimizing version … tends to understate the value of money as an indicator for monetary policy. …
Persistent link: https://www.econbiz.de/10005707651
public goods generating private utility. We find that lack of fiscal commitment gives rise to excessive public spending. The …
Persistent link: https://www.econbiz.de/10005410691
This article discusses a technical aspect of the Federal Reserve's monetary targeting procedure that has come to be known as "base drift." The Fed has been announcing larger ranges for the growth of M1 and other monetary aggregates since 1975. These ranges have been expressed in terms of rates...
Persistent link: https://www.econbiz.de/10004993991
rate. Money’s role in monetary policy has been tertiary, at best. Indeed, several influential economists have suggested … that money is irrelevant for monetary policy. They suggest that central banks can control inflation by (i) controlling a … rate in order to exert greater control over longer-term rates. I offer an alternative perspective: namely, that money is …
Persistent link: https://www.econbiz.de/10010558739
Persistent link: https://www.econbiz.de/10005515052
This paper establishes the existence of equilibria for environments in which outside money is issued competitively …. Such equilibria are typically believed not to exist because of a classic overissue problem: if money is valued in … equilibrium, an issuer produces money until its value is driven to zero. By backward induction, money cannot have value in the …
Persistent link: https://www.econbiz.de/10005515064
In the P-star model the price level is determined by the money stock per unit of potential output and the long …-run equilibrium level of the velocity of money. This article applies this model to Austria. Problems in identifying permanent shocks …-difference version is not so suspect. While evidence is found of a long-run relationship between Austria inflation and money growth, even …
Persistent link: https://www.econbiz.de/10005490892
money growth is essentially zero. We investigate whether standard monetary models driven by monetary shocks are consistent … general equilibrium models with sticky information. ; Earlier title: Inflation and money: a puzzle …
Persistent link: https://www.econbiz.de/10005490909
Persistent link: https://www.econbiz.de/10005387444
inflation have changed several times. Each of the changes in the measures of money was sparked by a breakdown in the fit of … empirical money demand functions. The Federal Reserve's strategy following these breakdowns has been to redefine money by simply … empirically stable money demand function. Unfortunately, while a stable demand for money is a worthwhile ultimate goal, history …
Persistent link: https://www.econbiz.de/10005410685