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Expectations-driven liquidity traps : implications for monetary and fiscal policy

Nakata, Taisuke; Schmidt, Sebastian - 2019

We study optimal monetary and fiscal policy in a New Keynesian model where occasional declines in agents' confidence can give rise to persistent liquidity trap episodes. Unlike in the case of fundamental-driven liquidity traps, there is no straightforward recipe for mitigating the welfare costs...

Persistent link: https://www.econbiz.de/10012037377

Expectations and the stability problem for optimal monetary policies

Evans, George W.; Honkapohja, Seppo - 2000

Eine auf den Fundamentaldaten beruhende Regelbindung der Geldpolitik ohne Selbstverpflichtung, die bei vollkommen … geeigneter Weise in die optimale Geldpolitik einbezogen werden. Diese eindeutige Schlußfolgerung gilt auch dann, wenn sich der … wichtig es ist, die Geldpolitik angemessen zu gestalten und dabei nicht nur die Fundamentaldaten, sondern auch direkt die …

Persistent link: https://www.econbiz.de/10011418901

Conservatism and liquidity traps

Nakata, Taisuke; Schmidt, Sebastian - 2015

Persistent link: https://www.econbiz.de/10011288633

Near-rational exuberance

Bullard, James Brian (contributor); … - 2005

We study how the use of judgement or add-factorsʺ 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/10003209153

Speed limit policy and liquidity traps

Nakata, Taisuke; Schmidt, Sebastian; Yoo, Paul - 2018

The zero lower bound (ZLB) constraint on interest rates makes speed limit policies (SLPs) - policies aimed at stabilizing output growth - less effective. Away from the ZLB, the history dependence induced by a concern for output growth stabilization improves the inflation-output tradeoff for a...

Persistent link: https://www.econbiz.de/10011921493

Average inflation targeting and the interest rate lower bound

Budianto, Flora; Nakata, Taisuke; Schmidt, Sebastian - 2020

Assigning a discretionary central bank a mandate to stabilize an average in ation rate| rather than a period-by-period in ation rate|increases welfare in a New Keynesian model with an occasionally binding lower bound on nominal interest rates. Under rational expecta- tions, the...

Persistent link: https://www.econbiz.de/10012206238

The risky steady state and the interest rate lower bound

Hills, Timothy; Nakata, Taisuke; Schmidt, Sebastian - 2016

Persistent link: https://www.econbiz.de/10011618375

Gradualism and liquidity traps

Nakata, Taisuke; Schmidt, Sebastian - 2016

Persistent link: https://www.econbiz.de/10011619853

Attenuating the forward guidance puzzle : implications for optimal monetary policy

Nakata, Taisuke; Ogaki, Ryota; Schmidt, Sebastian; Yoo, Paul - 2019

We examine the implications of less powerful forward guidance for optimal policy using a sticky-price model with an effective lower bound (ELB) on nominal interest rates as well as a discounted Euler equation and Phillips curve. When the private-sector agents discount future economic conditions...

Persistent link: https://www.econbiz.de/10011959272