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Optimal monetary policy in a model of money and credit
Gomis-Porqueras, Pedro; Sanches, Daniel R. - Federal Reserve Bank of Philadelphia - 2011
. Specifically, they characterize the optimal return on money in the presence of credit arrangements. There is a dual role for credit …: It allows buyers to trade without fiat money and also permits them to borrow against future income. However, not all … traders have access to credit. As a result, there is a social role for fiat money because it allows agents to self …
Persistent link: https://www.econbiz.de/10009216231
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Fiscal volatility shocks and economic activity
Fernandez-Villaverde, Jesus; Guerron-Quintana, Pablo; … - Federal Reserve Bank of Philadelphia - 2011
The authors study the effects of changes in uncertainty about future fiscal policy on aggregate economic activity. Fiscal deficits and public debt have risen sharply in the wake of the financial crisis. While these developments make fiscal consolidation inevitable, there is considerable...
Persistent link: https://www.econbiz.de/10009216227
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Soverign risk and the effects of fiscal retrenchment in deep recessions
Corsetti, Giancarlo; Kuester, Keith; Meier, Andre; … - Federal Reserve Bank of Philadelphia - 2011
The authors analyze the effects of government spending cuts on economic activity in an environment of severe fiscal strain, as reflected by a sizeable risk premium on government debt. Specifically, they consider a "sovereign risk channel," through which sovereign default risk spills over to the...
Persistent link: https://www.econbiz.de/10009320690
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Floats, pegs and the transmission of fiscal policy
Corsetti, Giancarlo; Kuester, Keith; Muller, Gernot J. - Federal Reserve Bank of Philadelphia - 2011
According to conventional wisdom, fiscal policy is more effective under a fixed than under a flexible exchange rate regime. In this paper the authors reconsider the transmission of shocks to government spending across these regimes within a standard New Keynesian model of a small open economy....
Persistent link: https://www.econbiz.de/10008852842
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Macroeconomic dynamics near the ZLB: a tale of two equilibria
Aruoba, S. Boragan; Schorfheide, Frank - Federal Reserve Bank of Philadelphia - 2013
This paper studies the dynamics of a New Keynesian dynamic stochastic general equilibrium (DSGE) model near the zero lower bound (ZLB) on nominal interest rates. In addition to the standard targeted-inflation equilibrium, we consider a deflation equilibrium as well as a Markov sunspot...
Persistent link: https://www.econbiz.de/10010681653
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Comment on Cavalcanti and Nosal's "Counterfeiting as private money in mechanism design"
Monnet, Cyril - Federal Reserve Bank of Philadelphia - 2010
money and unrestricted money holdings. He shows that when trade takes place in Walrasian markets, counterfeits circulate and …
Persistent link: https://www.econbiz.de/10008676449
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Interest rates and prices in an inventory model of money with credit
Dotsey, Michael; Guerron-Quintana, Pablo - Federal Reserve Bank of Philadelphia - 2012
substantially changes the dynamics in the model, allowing agents to significantly smooth consumption and reduce the movements in …
Persistent link: https://www.econbiz.de/10010628487
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Money in the utility function: an adequate microfoundation of money?
Croushore, Dean D. - Federal Reserve Bank of Philadelphia - 1989
Persistent link: https://www.econbiz.de/10005389618
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Real-time macroeconomic monitoring: real activity, inflation, and interactions
Aruoba, S. Boragan; Diebold, Francis X. - Federal Reserve Bank of Philadelphia - 2010
The authors sketch a framework for monitoring macroeconomic activity in real-time and push it in new directions. In particular, they focus not only on real activity, which has received most attention to date, but also on inflation and its interaction with real activity. As for the recent...
Persistent link: https://www.econbiz.de/10008627185
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Macro fiscal policy in economic unions: states as agents
Carlino, Gerald A.; Inman, Robert P. - Federal Reserve Bank of Philadelphia - 2014
An important component of the American Recovery and Reinvestment Act’s (ARRA’s) $796 billion proposed stimulus budget was $318 billion in fiscal assistance to state and local governments, yet the authors have no precise estimates of the impact of such assistance on the macroeconomy. In...
Persistent link: https://www.econbiz.de/10010812647