Deviatov, Alexei; Wallace, Neil - In: Journal of Monetary Economics 56 (2009) 3, pp. 283-288
Optimal monetary policy is studied in a model with (i) heterogeneity in the degree to which different people are monitored (have publicly known histories); (ii) idiosyncratic shocks that give rise to heterogeneity in earning and spending realizations; and (iii) central-bank intervention in a...