Showing 1 - 10 of 246
Persistent link: https://www.econbiz.de/10012697954
Persistent link: https://www.econbiz.de/10012589539
We study how changes in the value of the steady-state real interest rate affect the optimal inflation target, both in …-for-one: increases in the optimal inflation rate are generally lower than declines in the steady-state real interest rate. Our approach … allows us not only to assess the uncertainty surrounding the optimal inflation target, but also to determine the latter while …
Persistent link: https://www.econbiz.de/10012927026
determine inflation in this regime, so I base the analysis on the fiscal theory of the price level. I find that monetary policy … can peg the nominal rate, and determine expected inflation. With sticky prices, monetary policy can also affect real … interest rates and output, though higher interest rates raise output and then inflation. The conventional sign requires a …
Persistent link: https://www.econbiz.de/10013044987
In a recent paper, Canzoneri, Henderson, and Rogoff have shown that it is possible for the monetary authority to peg the nominal interest rate without creating price level indeterminacy in a simplified version of the 1975 Sargent-Wallace model. The present paper begins by reviewing that result,...
Persistent link: https://www.econbiz.de/10013219333
This paper reconsiders a result obtained by Sargent and Wallace, namely, that price level indeterminacy obtains in their well-known model if the monetary authorities adopt a policy feedback rule for the interest rate rather than the money stock. Since the Federal Reserve seems often to have used...
Persistent link: https://www.econbiz.de/10013219724
This paper investigates the hypothesis that surprise changes in the money supply and anticipated inflation (the Mundell … surprises and expected real interest or an inverse relationship between anticipated inflation and expected real interest. These …
Persistent link: https://www.econbiz.de/10013211690
Persistent link: https://www.econbiz.de/10010189357
that modest alterations to monetary policy have vast consequences is inconsistent with theory and not supported by evidence …
Persistent link: https://www.econbiz.de/10013129137
The paper considers three methods for eliminating the zero lower bound on nominal interest rates and thus for restoring symmetry to domain over which the central bank can vary its policy rate. They are: (1) abolishing currency (which would also be a useful crime-fighting measure); (2) paying...
Persistent link: https://www.econbiz.de/10013152378