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Monetary Policy Wedges and the Long-term Liabilities of Households and Firms
Binsbergen, Jules H. van; Grotteria, Marco - National Bureau of Economic Research - 2024
We examine the transmission of monetary policy shocks to the long-duration liabilities of households and firms using …
Persistent link: https://www.econbiz.de/10014486229
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Central Bank Credibility and Fiscal Responsibility
Schreger, Jesse; Yared, Pierre; Zaratiegui, Emilio - National Bureau of Economic Research - 2023
We consider a New Keynesian model with strategic monetary and fiscal interactions. The fiscal authority maximizes social welfare. Monetary policy is delegated to a central bank with an anti-inflation bias that suffers from a lack of commitment. The impact of central bank hawkishness on debt...
Persistent link: https://www.econbiz.de/10014287347
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Spillovers and Spillbacks
Acharya, Sushant; Pesenti, Paolo A. - National Bureau of Economic Research - 2024
We study international monetary policy spillovers and spillbacks in a tractable two-country Heterogeneous Agent New Keynesian model. Relative to Representative Agent (RANK) models, our framework introduces a precautionary-savings channel, as households in both countries face uninsurable income...
Persistent link: https://www.econbiz.de/10014512099
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Estimating the Effects of Political Pressure on the Fed : A Narrative Approach with New Data
Drechsel, Thomas - National Bureau of Economic Research - 2024
This paper combines new data and a narrative approach to identify shocks to political pressure on the Federal Reserve … and 2016. Since personal interactions do not necessarily reflect political pressure, I develop a narrative identification … vector autoregression that includes the personal interaction data. I find that political pressure shocks (i) increase …
Persistent link: https://www.econbiz.de/10014544739
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Tell Me Something I Don't Already Know : Learning in Low and High-Inflation Settings
Weber, Michael; Candia, Bernardo; Ropele, Tiziano; … - National Bureau of Economic Research - 2023
Using randomized control trials (RCTs) applied over time in different countries, we study how the economic environment affects how agents learn from new information. We show that as inflation has recently risen in advanced economies, both households and firms have become more attentive and...
Persistent link: https://www.econbiz.de/10014322872
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The Central Bank's Dilemma : Look Through Supply Shocks or Control Inflation Expectations?
Beaudry, Paul; Carter, Thomas J.; Lahiri, Amartya - National Bureau of Economic Research - 2023
When countries are hit by supply shocks, central banks often face the dilemma of either looking through such shocks or … abrupt pivots in the policy stance. In particular, it is optimal for the central bank to initially look through supply shocks …
Persistent link: https://www.econbiz.de/10014372498
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Whatever it Takes? The Impact of Conditional Policy Promises
Haddad, Valentin; Moreira, Alan; Muir, Tyler - National Bureau of Economic Research - 2023
At the announcement of a new policy, agents form a view of state-contingent policy actions and impact. We develop a method to estimate this state-contingent perception and implement it for many asset-purchase interventions worldwide. Expectations of larger support in bad states--"policy...
Persistent link: https://www.econbiz.de/10014287359
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Credibility and Explicit Inflation Targeting
King, Robert G.; Lu, Yang - National Bureau of Economic Research - 2022
In his 2004 inflation targeting manifesto, Marvin Goodfriend described US monetary policy as implicit inflation targeting and advocated explicit targeting. Summarizing the 1965-2000 US inflation experience, he highlighted the importance of evolving Fed credibility, which accords with our recent...
Persistent link: https://www.econbiz.de/10013210040
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Monetary-Based Asset Pricing : A Mixed-Frequency Structural Approach
Bianchi, Francesco; Ludvigson, Sydney C.; Ma, Sai - National Bureau of Economic Research - 2022
We integrate a high-frequency monetary event study into a mixed-frequency macro-finance model and structural estimation. The model and estimation allow for jumps at Fed announcements in investor beliefs, providing granular detail on why markets react to central bank communications. We find that...
Persistent link: https://www.econbiz.de/10013210100
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Inflation Past, Present and Future : Fiscal Shocks, Fed Response, and Fiscal Limits
Cochrane, John H. - National Bureau of Economic Research - 2022
Our current inflation stemmed from a fiscal shock. The Fed is slow to react. Why? Will the Fed's slow reaction spur more inflation? I write a simple model that encompasses the Fed's mild projections and its slow reaction, and traditional views that inflation will surge without swift rate rises....
Persistent link: https://www.econbiz.de/10013210124