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Involuntary unemployment and the business cycle

Christiano, Lawrence J.; Trabandt, Mathias; Walentin, Karl - 2010

We propose a monetary model in which the unemployed satisfy the official US definition of unemployment: they are people without jobs who are (i) currently making concrete efforts to find work and (ii) willing and able to work. In addition, our model has the property that people searching for...

Persistent link: https://www.econbiz.de/10009640338

Taylor rules in a limited participation model

Christiano, Lawrence J.; Gust, Christopher J. - Federal Reserve Bank of Chicago - 1999

We use the limited participation model of money as a laboratory for studying the operating characteristics of Taylor rules for setting the rate of interest. Rules are evaluated according to their ability to protect the economy from bad outcomes such as the burst of inflation observed in the...

Persistent link: https://www.econbiz.de/10005419947

Expectation traps and monetary policy

Albanesi, Stefania; Chari, V.V.; Christiano, Lawrence J. - Federal Reserve Bank of Chicago - 2002

Why is it that inflation is persistently high in some periods and persistently low in other periods? We argue that lack of commitment in monetary policy may bear a large part of the blame. We show that, in a standard equilibrium model, absence of commitment leads to multiple equilibria, or...

Persistent link: https://www.econbiz.de/10005419951

Nominal rigidities and the dynamic effects of a shock to monetary policy

Christiano, Lawrence J.; Eichenbaum, Martin; Evans, … - Federal Reserve Bank of Chicago - 2001

We present a model embodying moderate amounts of nominal rigidities which accounts for the observed inertia in inflation and persistence in output. The key features of our model are those that prevent a sharp rise in marginal costs after an expansionary shock to monetary policy. Of these...

Persistent link: https://www.econbiz.de/10005419958

Inside money, outside money and short-term interest rates

Chari, V. V.; Christiano, Lawrence J.; Eichenbaum, Martin - In: Proceedings (1994), pp. 1354-1401

Persistent link: https://www.econbiz.de/10005420287

Monetary policy in a financial crisis

Christiano, Lawrence J.; Gust, Christopher; Roldos, Jorge - Federal Reserve Bank of Cleveland - 2002

What are the economic effects of an interest rate cut when an economy is in the midst of a financial crisis? Under what conditions will a cut stimulate output and employment, and raise welfare? Under which will it have the opposite effects? The authors answer these questions in a general class...

Persistent link: https://www.econbiz.de/10005526624

Involuntary unemployment and the business cycle

Christiano, Lawrence J.; Trabrandt, Mathias; Walentin, Karl - 2012

Can a model with limited labor market insurance explain standard macro- and labor market data jointly? We seek to construct a monetary model in which: i) the unemployed are worse off than the employed, i.e. unemployment is involuntary and ii) the labor force participation rate varies with the...

Persistent link: https://www.econbiz.de/10010320732

Involuntary Unemployment and the Business Cycle

Christiano, Lawrence J.; Trabrandt, Mathias; Walentin, Karl - Sveriges Riksbank - 2010

Persistent link: https://www.econbiz.de/10008516098

Understanding the fiscal theory of the price level

Christiano, Lawrence J.; Fitzgerald, Terry J. - In: Economic Review (2000) Q II, pp. 2-38

Price stability is an important goal of public policy. To reach this goal, two key questions must be addressed: How can … price stability be achieved? And, how much price stability is desirable? The authors review the fiscal theory of the price … level, with special emphasis on its implications for the feasibility and desirability of price stability. …

Persistent link: https://www.econbiz.de/10005360750

Modeling the liquidity effect of a money shock

Christiano, Lawrence J. - In: Quarterly Review (1991) Win, pp. 3-34

There is widespread agreement that a surprise increase in an economy's money supply drives the nominal interest rate down and economic activity up, at least in the short run. This is understood as reflecting the dominance of the liquidity effect of a money shock over an opposing force, the...

Persistent link: https://www.econbiz.de/10005360830

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