degrees of credibility, in which commitment and discretion become special cases of what we call quasi commitment. The monetary … measure of the (lack of) credibility of the monetary policy authority, we investigate the welfare effect of a marginal … increase in credibility. Our main finding is that, in a simple model of the monetary transmission mechanism, most of the gains …

This paper examines how risk in trading activity can affect the volatility of asset prices. We look for this … swap spread tends to converge to a long-run level, although trading risk can sometimes cause the spread to diverge from … that level. -- convergence trading ; interest rate swaps ; swap spread ; repurchase contracts ; trading risk ; volatility …