This paper proposes to assess the usefulness of central banks forward guidance since the start of the global economic crisis. Using a novel approach, the Wordscores methodology, we reveal that since 2009, central banks do provide a temporal guidance of their accommodative policy that can be...

We study monetary policy at the ZLB in a traceable three-period model, in which price-level targeting emerges endogenously in the welfare function. We characterize optimal price-level forward guidance under discretion and commitment. Potentially non-monotonic discretionary welfare losses are...

One of the often discussed negative aspects of the Stability and Growth Pact is the rigidity of its deficit rule. Several reform proposals aim currently at alleviating the rule in order to allow the automatic stabilizers to operate freely. However, such a reform is likely to cause even further...

The aim of this paper is to evaluate the robustness of the theory that claims restrictive effects of expansionary fiscal policy. It shows that such so-called “non-Keynesian effects” may arise from synchronous and opposite monetary policy interventions. The paper demonstrates this conclusion...

The American economy has undergone a dramatic structural change in the first decade of the 21st Century. The real-economy causes of this transformation, and their expression via the real estate market and its financial derivatives’ market, and their final manifestation in world financial...

In late 2008 and early 2009, there has been a serious deterioration in the economic outlook of political leaders, the media and many economic analysts. Comparisons of recent performance and the outlook have degenerated into comparisons with the Great Depression of the 1930s, suggesting that the...

From the policy mix theory to the related empirical works, quantifying the degree of coordination of monetary and fiscal policies seems to be missing. In this paper, we propose an index (ICPM) which measures the coherent nature of the policy mix rather than it restrictive or expansive character....

From the policy mix theory to the related empirical works, the quantification of the coordination of monetary and fiscal policies seems to be missing. In this paper, we propose an index (PMCI) which measures the coherent nature of the policy mix rather than it restrictive or expansive character....

Human labor input is considered the essential core in arising and increasing gross national product, so the equilibrium between supply and demand for labor, is one of the pivots of Egyptian strategy, the overcoming unemployment is the challenging for economic reform in Egypt, by creation...

Keynes’ original intention in introducing the concept of a liquidity trap was to explain the reason why persistent large amounts of unutilized resources were generated during the Great Depression. This paper shows that this type of phenomenon cannot be explained in the framework of a...