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Reading the Recent Monetary History of the U.S., 1959-2007

Fernández-Villaverde, Jesús - 2010

In this paper we report the results of the estimation of a rich dynamic stochastic general equilibrium (DSGE) model of the U.S. economy with both stochastic volatility and parameter drifting in the Taylor rule. We use the results of this estimation to examine the recent monetary history of the...

Persistent link: https://www.econbiz.de/10012462722

Monetary Policy and the Predictability of Nominal Exchange Rates

Eichenbaum, Martin - 2017

This paper studies how the monetary policy regime affects the relative importance of nominal exchange rates and inflation rates in shaping the response of real exchange rates to shocks. We document two facts about countries with floating exchange rates where monetary policy controls inflation...

Persistent link: https://www.econbiz.de/10012455523

Supply-Side Policies and the Zero Lower Bound

Fernández-Villaverde, Jesús - 2011

This paper examines how supply-side policies may play a role in fighting a low aggregate demand that traps an economy at the zero lower bound (ZLB) of nominal interest rates. Future increases in productivity or reductions in mark-ups triggered by supply-side policies generate a wealth effect...

Persistent link: https://www.econbiz.de/10012461115

Nominal Rigidities and the Dynamic Effects of a Shock to Monetary Policy

Christiano, Lawrence J. - 2001

an expansionary shock to monetary policy. Of these features, the most important are staggered wage contracts of average …

Persistent link: https://www.econbiz.de/10012470317

Monetary Policy Shocks : What Have We Learned and to What End?

Christiano, Lawrence J. - 1998

This paper reviews recent research that grapples with the question: What happens after an exogenous shock to monetary … exogenous shock to monetary policy. Nevertheless, there is considerable agreement about the qualitative effects of a monetary … policy shock in the sense that inference is robust across a large subset of the identification schemes that have been …

Persistent link: https://www.econbiz.de/10012472408

Expectation Traps and Discretion

Chari, V. V. - 1996

We argue that discretionary monetary policy exposes the economy to welfare-decreasing instability. It does so by creating the potential for private expectations about the response of monetary policy to exogenous shocks to be self-fulfilling. Among the many equilibria that are possible, some have...

Persistent link: https://www.econbiz.de/10012473315

The Effects of Monetary Policy Shocks : Some Evidence from the Flow of Funds

Christiano, Lawrence J. - 1994

This paper uses the Flow of Funds accounts to assess the impact of a monetary policy shock on the borrowing and lending … sectors can be summarized as follows. First, following a contractionary shock to monetary policy, net funds raised by the … business sector increases for roughly a year. Thereafter, as the recession induced by the policy shock gains momentum, net …

Persistent link: https://www.econbiz.de/10012474229

Some Empirical Evidence on the Effects of Monetary Policy Shocks on Exchange Rates

Eichenbaum, Martin - 1993

rates. The temporal pattern of the depreciation in U.S. nominal exchange rates following a positive monetary policy shock is …

Persistent link: https://www.econbiz.de/10012474691

Identification and the Liquidity Effect of a Monetary Policy Shock

Christiano, Lawrence J. - 1991

Conventional wisdom holds that unanticipated expansionary monetary policy shocks cause transient but persistent decreases in real and nominal interest rates. However a number of econometric studies argue that the evidence favors the opposite view, namely that these shocks actually raise, rather...

Persistent link: https://www.econbiz.de/10012475068

When is the government spending multiplier large?

Christiano, Lawrence - 2009

We argue that the government-spending multiplier can be much larger than one when the zero lower bound on the nominal interest rate binds. The larger is the fraction of government spending that occurs while the nominal interest rate is zero, the larger is the value of the multiplier. After...

Persistent link: https://www.econbiz.de/10012463255