In academic and policy circles, the assumption is often made that the Fed and the European Central Bank (ECB) have a perfectly identical understanding of what monetary policy can achieve and they follow the same policy strategy. This assumption seats uncomfortably with the different legislative...

A fully opened capital account, a pure floating exchange rate, and inflation-targeting monetary policy is the macroeconomic setting currently recommended in Latin America by the International Monetary Fund and the orthodoxy. In this paper, we present an alternative macroeconomic regime proposal...

This paper examines Federal Reserve Chairman Ben Bernanke's recipe for deflation fighting and the specific policy actions he took in the aftermath of the 2008 financial crisis. Both in his academic and policy work, Bernanke has made the case that monetary policy is able to stem deflationary...

Despite compelling arguments by Lester Telser, the myth continues that the recession of 1937-38 was caused by the Federal Reserve's three increases in reserve requirements from 1936 to 1937. Telser argued that banks were able to significantly increase lending prior to the recession by using...

It is now a few years since the introduction of the common currency, and Europe is still experiencing high unemployment. The conventional logic attributes this problem to flaws in the labor market. In this paper, we look at the changes that occur if trade unions and the central bank have...

This paper uses a detailed macroeconomic model characterized by demand-led growth, Sraffian pricing, and the Kaldor-Pasinetti analysis of income distribution at the macrolevel to develop a framework for evaluation of the long-term implications of monetary policy. Focus is placed on the...

This article presents an overview of monetary policy in Australia and highlights the persistence and volatility of inflation under successive monetary policy regimes, 1950-2010. A series of unit root tests specified both linearly and nonlinearly investigate whether inflation persistence has the...

The role of monetary policy in the cyclical behavior of the labor share and capacity utilization in the U.S. economy is studied empirically. Previous estimation results remain robust; the inclusion of the rate of interest does not alter the underlying specification of the distributive demand...

This paper argues that De Long's (2000) announcement of "the triumph of monetarism" is misplaced on the grounds that the cornerstone of monetarism-the quantity theory of money-is no longer used by central banks in practice. Instead, modern monetary policy is based on maintaining aggregate demand...

This paper builds on a synthesis of endogenous money and liquidity preference theory to address the mechanisms by which monetary policy takes effect. We focus on the United Kingdom, under a range of institutional arrangements. Rather than operating solely by means of "the" exogenous interest...