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Global Forces and Monetary Policy Effectiveness
Boivin, Jean; Giannoni, Marc P. - National Bureau of Economic Research (NBER) - 2008
In this paper, we quantify the changes in the relationship between international forces and many key US macroeconomic variables over the 1984-2005 period, and analyze changes in the monetary policy transmission mechanism. We do so by estimating a Factor-Augmented VAR on a large set of US and...
Persistent link: https://www.econbiz.de/10005050455
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The Price Theory of Money, Prospero's Liquidity Trap, and Sudden Stop: Back to Basics and Back
Calvo, Guillermo - National Bureau of Economic Research (NBER) - 2012
Fiat money contains the seeds of its own destruction. It has no intrinsic value and, yet, it can be exchanged for valuable consumption and production goods. As Hahn (1965) shows, this situation puts fiat money's market value or liquidity premium at the brink of collapse. In this paper I will...
Persistent link: https://www.econbiz.de/10010796587
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Central Bank Credibility: An Historical and Quantitative Exploration
Bordo, Michael David; Siklos, Pierre L. - National Bureau of Economic Research (NBER) - 2015
In this paper we provide empirical measures of central bank credibility and augment these with historical narratives from eleven countries. To the extent we are able to apply reliable institutional information we can also indirectly assess their role in influencing the credibility of the...
Persistent link: https://www.econbiz.de/10011119808
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Central Bank Credibility, Reputation and Inflation Targeting in Historical Perspective
Bordo, Michael David; Siklos, Pierre - National Bureau of Economic Research (NBER) - 2014
This paper examines the historical evolution of central bank credibility using both historical narrative and empirics for a group of 16 countries, both advanced and emerging. It shows how the evolution of credibility has gone through a pendulum where credibility was high under the classical gold...
Persistent link: https://www.econbiz.de/10011079872
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Monetary Rules for Small, Open, Emerging Economies
Laxton, Douglas; Pesenti, Paolo A. - National Bureau of Economic Research (NBER) - 2003
This paper develops a variant of the IMF's Global Economic Model (GEM) suitable to analyze macroeconomic dynamics in open economies, and uses it to assess the effectiveness of Taylor rules and Inflation-Forecast-Based (IFB) rules in stabilizing variability in output and inflation. Our findings...
Persistent link: https://www.econbiz.de/10005710557
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Benefits and Spillovers of Greater Competition in Europe: A Macroeconomic Assesment
Bayoumi, Tamim A; Laxton, Douglas; Pesenti, Paolo A. - National Bureau of Economic Research (NBER) - 2004
Using a general-equilibrium simulation model featuring nominal rigidities and monopolistic competition in product and labor markets, this paper estimates the macroeconomic benefits and international spillovers of an increase in competition. After calibrating the model to the euro area vs. the...
Persistent link: https://www.econbiz.de/10005778353
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Potential Pitfalls for the Purchasing-Power-Parity Puzzle? Sampling and Specification Biases in Mean-Reversion Tests of the Law of One Price
Taylor, Alan M. - National Bureau of Economic Research (NBER) - 2000
The PPP puzzle is based on empirical evidence that international price differences for individual goods (LOOP) or … baskets of goods (PPP) appear highly persistent or even non-stationary. The present consensus is these price differences have … testing for PPP or LOOP, model specification and data sampling should not proceed without consideration of the actual …
Persistent link: https://www.econbiz.de/10005580056
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How to Advance Theory with Structural VARs: Use the Sims-Cogley-Nason Approach
Kehoe, Patrick J. - National Bureau of Economic Research (NBER) - 2006
The common approach to evaluating a model in the structural VAR literature is to compare the impulse responses from structural VARs run on the data to the theoretical impulse responses from the model. The Sims-Cogley-Nason approach instead compares the structural VARs run on the data to...
Persistent link: https://www.econbiz.de/10005774407
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Are Structural VARs with Long-Run Restrictions Useful in Developing Business Cycle Theory?
Chari, Varadarajan; Kehoe, Patrick J.; McGrattan, Ellen R. - National Bureau of Economic Research (NBER) - 2008
The central finding of the recent structural vector autoregression (SVAR) literature with a differenced specification of hours is that technology shocks lead to a fall in hours. Researchers have used this finding to argue that real business cycle models are unpromising. We subject this SVAR...
Persistent link: https://www.econbiz.de/10005089012
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Shocks, Structures or Monetary Policies? The Euro Area and US After 2001
Christiano, Lawrence; Rostagno, Massimo; Motto, Roberto - National Bureau of Economic Research (NBER) - 2007
The US Federal Reserve cut interest rates more vigorously in the recent recession than the European Central Bank did. By comparison with the Fed, the ECB followed a more measured course of action. We use an estimated dynamic general equilibrium model with financial frictions to show that...
Persistent link: https://www.econbiz.de/10005085028