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We develop a flexible semiparametric time series estimator that is then used to assess the causal effect of monetary policy interventions on macroeconomic aggregates. Our estimator captures the average causal response to discrete policy interventions in a macro-dynamic setting, without the need...
Persistent link: https://www.econbiz.de/10010969232
This paper reviews and interprets some of the key policy implications that flow from a class of DSGE models for optimal monetary policy in the open economy. The framework suggests that good macroeconomic outcomes in open economies are possible by focusing inflation targeting that is implemented...
Persistent link: https://www.econbiz.de/10010969375
Over the last twenty-five years, a set of influential studies has placed interest rates at the heart of analyses that interpret and evaluate monetary policies. In light of this work, the Federal Reserve's recent policy of "quantitative easing," with its goal of affecting the supply of liquid...
Persistent link: https://www.econbiz.de/10010950639
The U.S. Federal Reserve used the Term Auction Facility (TAF) to provide term funding to eligible depository institutions from December 2007 to March 2010. According to the Fed, the purpose of TAF was to inject term funds through a broader range of counterparties and against a broader range of...
Persistent link: https://www.econbiz.de/10010950874
, there is a conceptual component to all this as well. In contrast to the last century or more of monetary theory, which has … the asset side of the central bank's balance sheet. The implications for monetary theory are profound. …
Persistent link: https://www.econbiz.de/10010950954
This paper explores the relationship between inflation and the existence of a publicly-traded, long-maturity, nominal, domestic-currency bond market. Bond holders suffer from inflation and could be a potent anti-inflationary force; I ask whether their presence is apparent empirically. I use a...
Persistent link: https://www.econbiz.de/10010951071
We analyze the optimal Taylor rule in a standard New Keynesian model. If the central bank can observe the output gap and the inflation rate without error, then it is typically optimal to respond infinitely strongly to observed deviations from the central bank's targets. If it observes inflation...
Persistent link: https://www.econbiz.de/10010951201
We examine global dynamics under infinite-horizon learning in New Keynesian models where the interest-rate rule is subject to the zero lower bound. As in Evans, Guse and Honkapohja (2008), the intended steady state is locally but not globally stable. Unstable deflationary paths emerge after...
Persistent link: https://www.econbiz.de/10011271457
This paper uses a New Keynesian model with banks and deposits to study the macroeconomic effects of policies that pay interest on reserves. While their effects on output and inflation are small, these policies require major adjustments in the way that the monetary authority manages the supply of...
Persistent link: https://www.econbiz.de/10011262796
repayment. The theory is used to answer a number of positive and normative questions: What are the determinants of the fed funds …
Persistent link: https://www.econbiz.de/10011262797