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Monnet, Cyril - 2005

matching model with no commitment and no enforcement. An intrinsically worthless but perfectly durable object called a ‘note …

Persistent link: https://www.econbiz.de/10011604558

Money talks

Hoerova, Marie; Monnet, Cyril; Temzelides, Ted - 2009

We study credible information transmission by a benevolent Central Bank. We consider two possibilities: direct … revelation through an announcement, versus indirect information transmission through monetary policy. These two ways of … transmitting information have very different consequences. Since the objectives of the Central Bank and those of individual …

Persistent link: https://www.econbiz.de/10011605137

Infinite-dimensional VARs and factor models

Chudik, Alexander; Pesaran, Hashem - 2009

This paper introduces a novel approach for dealing with the 'curse of dimensionality' in the case of large linear dynamic systems. Restrictions on the coefficients of an unrestricted VAR are proposed that are binding only in a limit as the number of endogenous variables tends to infinity. It is...

Persistent link: https://www.econbiz.de/10011605044

Why do financial systems differ? History matters

Monnet, Cyril; Quintin, Erwan - 2005

We describe a dynamic model of financial intermediation in which fundamental characteristics of the economy imply a unique equilibrium path of bank and financial market lending. Yet we also show that economies whose fundamental characteristics have converged may continue to have very different...

Persistent link: https://www.econbiz.de/10011604488

Near-rational exuberance

Bullard, James; Evans, George W.; Honkapohja, Seppo - 2005

We study how the use of judgement or “add-factors” in macroeconomic forecasting may disturb the set of equilibrium outcomes when agents learn using recursive methods. We isolate conditions under which new phenomena, which we call exuberance equilibria, can exist in standard macroeconomic...

Persistent link: https://www.econbiz.de/10011604601

Debt stabilizing fiscal rules

Michel, Philippe; von Thadden, Leopold; Vidal, Jean-Pierre - 2006

Unstable government debt dynamics can typically be corrected by various fiscal instruments, like appropriate adjustments in government spending, public transfers, or taxes. This paper investigates properties of state-contingent debt targeting rules which link stabilizing budgetary adjustments...

Persistent link: https://www.econbiz.de/10011604622

Distortionary taxation, debt, and the price level

Schabert, Andreas; von Thadden, Leopold - 2006

This paper considers the nominal and real determinacy of equilibria under an exogenously specified path of interest rates in an economy in which taxation is either lump-sum or distortionary. Under lump-sum taxation, we confirm the well-known finding that equilibria display nominal...

Persistent link: https://www.econbiz.de/10011604623

A dynamic model of settlement

Koeppl, Thorsten Volker; Monnet, Cyril; Temzelides, Ted - 2006

full information first-best allocation cannot be supported due to incentive constraints. In contrast, this allocation is …

Persistent link: https://www.econbiz.de/10011604650

Monetary and fiscal policy interactions in a New Keynesian model with capital accumulation and non-Ricardian consumers

Leith, Campbell; von Thadden, Leopold - 2006

This paper develops a small New Keynesian model with capital accumulation and government debt dynamics. The paper discusses the design of simple monetary and fiscal policy rules consistent with determinate equilibrium dynamics in the absence of Ricardian equivalence. Under this assumption,...

Persistent link: https://www.econbiz.de/10011604695

On policy interactions among nations: when do cooperation and commitment matter?

Kempf, Hubert; von Thadden, Leopold - 2008

This paper offers a framework to study commitment and cooperation issues in games with multiple policymakers. To reconcile some puzzles in the recent literature on the nature of policy interactions among nations, we prove that games characterized by different commitment and cooperation schemes...

Persistent link: https://www.econbiz.de/10011604926