Similar Search Results

Obstfeld, Maurice - 2021

and monetary union (EMU), as well as on some key problems of Stage Three that EMU's monetary and fiscal structures appear … joint currency. A third problems, one that is central for EMU and to any currency union, lies behind the difficulty of the … consider the past and prospective fiscal adjustments of the EMU 11, and suggest these might pose future difficulties for …

Persistent link: https://www.econbiz.de/10013235280

Monetary and Fiscal Remedies for Deflation

Auerbach, Alan J. - 2011

Prevalent thinking about liquidity traps suggests that the perfect substitutability of money and bonds at a zero short-term nominal interest rate renders open-market operations ineffective for achieving macroeconomic stabilization goals. In an earlier paper, we showed that this reasoning does...

Persistent link: https://www.econbiz.de/10013133109

Liquidity Traps and Expectation Dynamics : Fiscal Stimulus or Fiscal Austerity?

Benhabib, Jess - 2012

We examine global dynamics under infinite-horizon learning in New Keynesian models where the interest-rate rule is subject to the zero lower bound. As in Evans, Guse and Honkapohja (2008), the intended steady state is locally but not globally stable. Unstable deflationary paths emerge after...

Persistent link: https://www.econbiz.de/10013106020

Optimal Time-Consistent Fiscal Policy with Uncertain Lifetimes

Calvo, Guillermo A.; Obstfeld, Maurice - 2021

This paper studies optimal fiscal policy in an economy where heterogeneous agents with uncertain lifetimes coexist. We show that some plausible social welfare functions lead to time-inconsistent optimal plans, and we suggest restrictions on social preferences that avoid the problem. The...

Persistent link: https://www.econbiz.de/10013229006

Dynamic Seigniorage Theory : an Exploration

Obstfeld, Maurice - 2008

This paper shows that the optimal extraction of seigniorage implies a strong tendency for inflation to fall over time toward its socially optimal level. The point is made using a multi-period model in which (i) the government can finance deficits through bond issue or money creation, (ii)...

Persistent link: https://www.econbiz.de/10012774830

Pricing-to-Market, the Interest-Rate Rule, and the Exchange Rate

Obstfeld, Maurice - 2010

Even when the exchange-rate plays no expenditure-switching role, countries may wish to have flexible exchange rates in order to free the domestic interest rate as a stabilization tool. In a setting with nontraded goods, exchange-rate movements may also enhance international risk sharing

Persistent link: https://www.econbiz.de/10012760533

Do We Really Need a New International Monetary Compact?

Obstfeld, Maurice; Rogoff, Kenneth - 2021

In recent years, many countries have instituted monetary reforms aimed at improving anti-inflation credibility. Is it a problem, however, that international welfare spillover effects seldom receive much consideration in the design of monetary reforms? Surprisingly, the answer may be no. Under...

Persistent link: https://www.econbiz.de/10013221846

New Directions for Stochastic Open Economy Models

Obstfeld, Maurice; Rogoff, Kenneth - 2021

The paper develops a simple stochastic new open economy macroeconomic model based on sticky nominal wages. Explicit solution of the wage-setting problem under uncertainty allows one to analyze the effects of the monetary regime on welfare, expected output, and the expected terms of trade....

Persistent link: https://www.econbiz.de/10013221940

Can We Sterilize? Theory and Evidence

Obstfeld, Maurice - 2021

This paper is a highly selective review of our knowledge about the scope for sterilized intervention in foreign exchange markets under alternative exchange-rate regimes. Section I demonstrates the potential importance of simultaneous-equations bias in single-equation econometric studies of the...

Persistent link: https://www.econbiz.de/10013233782

Monetary Sovereignty, Exchange Rates, and Capital Controls : The Trilemma in the Interwar Period

Obstfeld, Maurice - 2012

The interwar period was marked by the end of the classical gold standard regime and new levels of macroeconomic disorder in the world economy. The interwar disorder often is linked to policies inconsistent with the constraint of the open-economy trilemma the inability of policymakers...

Persistent link: https://www.econbiz.de/10012755788