Showing 1 - 10 of 24
monetary policy framework. Inclusion of judgement in forecasts can lead to self-fulfilling fluctuations, but without the …
Persistent link: https://www.econbiz.de/10005707643
In this paper, we present a dynamic optimizing model that allows explicitly for imperfect substitutability between different financial assets. This is specified in a manner which captures Tobin's (1969) view that an expansion of one asset's supply affects both the yield on that asset and the...
Persistent link: https://www.econbiz.de/10005352930
the origin of the aggregate volatility reduction. We show that states with relatively high concentrations in the durable-goods …
Persistent link: https://www.econbiz.de/10005360567
A key question that has arisen during recent debates is whether government spending multipliers are larger during times when resources are idle. This paper seeks to shed light on this question by analyzing new quarterly historical data covering multiple large wars and depressions in the U.S. and...
Persistent link: https://www.econbiz.de/10011027317
Recently, models of monetary policy have been constructed to include structural breaks to account for changes in policymaker preferences or operating procedures. These models typically assume that when changes occur, they happen once and for all. In this paper, we allow the policymaker and the...
Persistent link: https://www.econbiz.de/10005490882
Monetary policy VARs typically presume stability of the long-run outcomes. We introduce the possibility of switches in the long-run equilibrium in a cointegrated VAR by allowing both the covariance matrix and weighting matrix in the error-correction term to switch. We find that monetary policy...
Persistent link: https://www.econbiz.de/10005490901
We find that the magnitudes of the regional effects of monetary policy were considerably dampened during the Volcker-Greenspan era. Further, regional differences in the depths of monetary-policy-induced recessions are related to the concentration of the banking sector, whereas differences in the...
Persistent link: https://www.econbiz.de/10005490938
We study how determinacy and learnability of worldwide rational expectations equilibrium may be affected by monetary policy in a simple, two country, New Keynesian framework under both fixed and flexible exchange rates. We find that open economy considerations may alter conditions for...
Persistent link: https://www.econbiz.de/10005490985
We study the interaction of multiple large economies in dynamic stochastic general equilibrium. Each economy has a monetary policymaker that attempts to control the economy through the use of a linear nominal interest rate feedback rule. We show how the determinacy of worldwide equilibrium...
Persistent link: https://www.econbiz.de/10005491008
A major criticism of standard specifications of price adjustment in models for monetary policy analysis is that they violate the natural rate hypothesis by allowing output to differ from potential in steady state. In this paper we estimate a dynamic optimizing business cycle model whose...
Persistent link: https://www.econbiz.de/10005707655