The authors evaluate the Friedman-Schwartz hypothesis--that a more accommodative monetary policy could have greatly reduced the severity of the Great Depression. To do this, they first estimate a dynamic, general equilibrium model using data from the 1920s and 1930s. Although the model includes...

Examining the dynamics of commitment highlights some neglected features of time inconsistency. We modify the rules-versus-discretion question in three ways: 1) A government that does not commit today retains the option to do so tomorrow; 2) the government's commitment capability is restricted to...