A long-standing area of research and policy interest has been the construction of a measure of monetary policy stance. One measure that has been proposed—as an alternative to indices that employ monetary aggregates or exchange rates—is the spread between the actual real interest rate and its...

A long-standing area of research and policy interest is the construction of a measure of monetary policy stance. One measure that has been proposed-as an alternative to indices that employ monetary aggregates or exchange rates-is the spread between the actual real interest rate and its...

A long-standing area of research and policy interest is the construction of a measure of monetary policy stance. One measure that has been proposed, as an alternative to indices that employ monetary aggregates or exchange rates, is the spread between the actual real interest rate and its...

In this paper series are derived for capital utilisation, labour effort and total factor productivity (TFP) from a general equilibrium model with variable factor utilisation and labour adjustment costs. Impulse responses from the model show that firms initially respond to unanticipated shocks by...

This paper derives series for capital utilization, labour effort and total factor productivity (TFP) for the UK from a general equilibrium model with variable utilization and labour adjustment costs. Capital utilization tracks survey-based measures closely, but persistent movements in total...

We study the propagation of monetary shocks in a sticky price model with capital utilization and labor effort. Variable factor utilization enriches the propagation mechanism of monetary shocks by reducing the sensitivity of marginal costs to changes in aggregate output. Variable labor effort is...