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A new approach to assess inflation expectations anchoring using strategic surveys
Armantier, Olivier; Sbordone, Argia M.; Topa, Giorgio; … - 2022
We propose a new approach to assessing the anchoring of inflation expectations using "strategic surveys". Namely, we … measure households' revisions in long-run inflation expectations after they are presented with different economic scenarios. A …-run inflation expectations. We implement the method in the summer of 2019 and the spring-summer of 2021 when the anchoring of long …
Persistent link: https://www.econbiz.de/10013162104
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Central bank transparency and nonlinear learning dynamics
Eusepi, Stefano (contributor) - 2008
Central bank communication plays an important role in shaping market participants’ expectations. This paper studies a … helps stabilize expectations around the inflation target equilibrium. -- Monetary policy ; nonlinear dynamics ; learning …
Persistent link: https://www.econbiz.de/10003781685
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Optimal interest rate rules and inflation stabilization versus price-level stabilization
Giannoni, Marc Paolo - 2012
This paper compares the properties of interest rate rules such as simple Taylor rules and rules that respond to price-level fluctuations - called Wicksellian rules - in a basic forward-looking model. By introducing appropriate history dependence in policy, Wicksellian rules perform better than...
Persistent link: https://www.econbiz.de/10009522769
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Interest, reserves, and prices
Benigno, Gianluca; Benigno, Pierpaolo - 2021
We would like to propose a new framework for monetary policy analysis that encompasses, as a special case, the Neo-Wicksellian paradigm. A general form of an aggregate-demand equation reveals a role for liquidity, as well as less effective movements in future real rates with respect to current...
Persistent link: https://www.econbiz.de/10012584354
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Floor systems and the Friedman rule : the fiscal arithmetic of open market operations
Keister, Todd; Martin, Antoine; McAndrews, James Joseph - 2015
In a floor system of monetary policy implementation, the central bank remunerates bank reserves at or near the market rate of interest. Some observers have expressed concern that operating such a system will have adverse fiscal consequences for the public sector and may even require the...
Persistent link: https://www.econbiz.de/10011410519
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The heterogeneous impact of referrals on labor market outcomes
Lester, Benjamin; Rivers, David A.; Topa, Giorgio - 2021
We document a new set of facts regarding the impact of referrals on labor market outcomes. Our results highlight the importance of distinguishing between different types of referrals-those from family and friends and those from business contacts-and different occupations. Then we develop an...
Persistent link: https://www.econbiz.de/10012660361
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The option value of municipal liquidity: evidence from federal lending cutoffs during COVID-19
Haughwout, Andrew; Hijmans, Benjamin L.; Shachar, Or - 2021
We estimate the option value of municipal liquidity by studying bond market activity and public sector hiring decisions when government budgets are severely distressed. Using a regression discontinuity (RD) design, we exploit lending eligibility population cutoffs introduced by the federal...
Persistent link: https://www.econbiz.de/10012660369
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A model of the federal funds market : yesterday, today, and tomorrow
Afonso, Gara; Armenter, Roc; Lester, Benjamin - 2018
The landscape of the federal funds market changed drastically in the wake of the Great Recession as large-scale asset purchase programs left depository institutions awash with reserves and new regulations made it more costly for these institutions to lend. As traditional levers for implementing...
Persistent link: https://www.econbiz.de/10011806257
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The optimal supply of central bank reserves under uncertainty
Afonso, Gara; La Spada, Gabriele; Mertens, Thomas; … - 2023 - Revised December 2023
This paper provides an analytically tractable theoretical framework to study the optimal supply of central bank reserves when the demand for reserves is uncertain and nonlinear. We fully characterize the optimal supply of central bank reserves and associated market equilibrium. We find that the...
Persistent link: https://www.econbiz.de/10014426250
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How abundant are reserves? : evidence from the wholesale payment system
Afonso, Gara; Duffie, Darrell; Rigon, Lorenzo; Shin, … - 2022
Before the era of large central bank balance sheets, banks relied on incoming payments to fund outgoing payments in order to conserve scarce liquidity. Even in the era of large central bank balance sheets, rather than funding payments with abundant reserve balances, we show that outgoing...
Persistent link: https://www.econbiz.de/10013465317