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expected inflation. The inability of the Fed to maintain a credible commitment to low interest rates in the face of increased … government spending and rising inflation led to the Fed-Treasury Accord of March 1951. Following the Accord, the external …
Persistent link: https://www.econbiz.de/10010787050
potentially nonlinear effects of inflation on economic growth. We find that inflation is associated with significantly lower … effects of inflation on economic growth. We also document significant variation in the effect of inflation on growth across …
Persistent link: https://www.econbiz.de/10010886222
We study the pricing response of U.S. supermarkets to large demand shocks triggered by labor conflicts, mass population relocation, and shopping sprees around major snowstorms and hurricanes. Our focus on demand shocks is novel in the empirical literature that uses large datasets of individual...
Persistent link: https://www.econbiz.de/10010784151
model does a good job of accounting for the joint behavior of labor and goods markets, as well as inflation, during the … capital played critical roles in accounting for the small size of the drop in inflation that occurred during the Great …
Persistent link: https://www.econbiz.de/10010787055
groups in the dispersion of household-specific rates of inflation. Using survey data on inflation expectations, I show that … demographic groups with greater dispersion in experienced inflation also disagree more about future inflation. I argue that these … results can be rationalized from the perspective of an imperfect information model in which idiosyncratic inflation experience …
Persistent link: https://www.econbiz.de/10011075121
In this paper, we document that mortgage-backed securities (MBS) held by the Federal Reserve exhibit faster principal prepayment rates than MBS held by the rest of the market. Next, we show that this stylized fact persists even when controlling for factors that affect prepayment behavior, and...
Persistent link: https://www.econbiz.de/10011273692
We review recent changes in monetary policy that have led to development and testing of an overnight reverse repurchase agreement (ON RRP) facility, an innovative tool for implementing monetary policy during the normalization process. Making ON RRPs available to a broad set of investors,...
Persistent link: https://www.econbiz.de/10011255343
We propose an integrated treatment of the problems of optimal monetary and fiscal policy, for an economy in which prices are sticky (so that the supply-side effects of tax changes are more complex than in standard fiscal analyses) and the only available sources of government revenue are...
Persistent link: https://www.econbiz.de/10005368129
inconsistency problem arising from the temptation to stimulate the economy with unexpected inflation. Although this dynamic … mechanism design problem seems complex, society can implement the optimal policy simply by legislating an inflation cap that … specifies the highest allowable inflation rate. The more severe the time inconsistency problem, the more tightly the cap …
Persistent link: https://www.econbiz.de/10005368142
predict highly volatile inflation with no serial correlation. In this paper, we show that an otherwise-standard Ramsey model … that incorporates capital accumulation and habit persistence predicts highly persistent inflation. The result depends on … optimal inflation. Our work complements a recent strand of the Ramsey literature based on models with nominal rigidities. In …
Persistent link: https://www.econbiz.de/10005368152