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This paper applies a standard New Keynesian model to analyze the effects of monetary policy in the presence of a low natural rate of interest and a lower bound on interest rates. Under a standard inflation-targeting approach, inflation expectations will be anchored at a level below the inflation...
Persistent link: https://www.econbiz.de/10012867264
This paper uses a standard New Keynesian model to analyze the effects and implementation of various monetary policy frameworks in the presence of a low natural rate of interest and a lower bound on interest rates. Under a standard inflation-targeting approach, inflation expectations will be...
Persistent link: https://www.econbiz.de/10012871223
in the “liquidity trap equilibrium,” policy is mostly or always constrained. We use options data on future interest rates … target equilibrium and find no evidence in favor of the liquidity trap equilibrium. Quantitatively, while the lower bound has …
Persistent link: https://www.econbiz.de/10012851471