Similar Search Results

Temporary shocks and unavoidable transitions to a high-unemployment regime

Den Haan, Wouter J. - 2003

This paper develops a model with multiple steady states (low tax and unemployment rate versus high tax and unemployment rate) in which equilibrium selection is not conditioned on a sunspot variable. Instead, large enough shocks initiate unavoidable transitions from one regime to the other. The...

Persistent link: https://www.econbiz.de/10009635968

On the indeterminacy of determinacy and indeterminacy

Beyer, Andreas; Farmer, Roger E. A. - 2003

A number of authors have attemted to test whether the U.S. economy is in a determinate or an indeterminate equilibrium. We argue that to answer this question, one must be impose a priori restrictions on lag length that cannot be tested. We provide examples of two economic models. Model 1...

Persistent link: https://www.econbiz.de/10009635896

On the indeterminacy of new-Keynesian economics

Beyer, Andreas; Farmer, Roger E. A. - 2004

We study identiÞcation in a class of three-equation monetary models. We argue that these models are typically not identiÞed. For any given exactly identiffed model, we provide an algorithm that generates a class of equivalent models that have the same reduced form. We use our algorithm to...

Persistent link: https://www.econbiz.de/10009636546

A decade (and a global financial crisis) after Blinder

Bussière, Matthieu; Stracca, Livio - 2010

economic forecasts and policy simulations, with a special emphasis on the growing role of DSGE models within central banks. We …

Persistent link: https://www.econbiz.de/10009640280

Real convergence and its illusions

Kolasa, Marcin - 2010

This paper uses the EAGLE, a multi-country dynamic general equilibrium model, to illustrate dynamic adjustments in a small open economy undergoing real convergence. We consider the effects of productivity catch-up and misperceptions about future productivity developments. Our results indicate...

Persistent link: https://www.econbiz.de/10009640309

Interest rate effects of demographic changes in a New-Keynesian life-cycle framework

Kara, Engin; Thadden, Leopold von - 2010

This paper develops a small-scale DSGE model which embeds a demographic structure within a monetary policy framework …

Persistent link: https://www.econbiz.de/10009640420

Putting the New Keynesian DSGE model to the real-time forecasting test

Kolasa, Marcin; Rubaszek, Michał; Skrzypczyński, Paweł - 2009

-time forecasts from a richly-specified DSGE model to those from the Survey of Professional Forecasters, Bayesian VARs and VARs using … priors from a DSGE model. We show that the analyzed DSGE model is relatively successful in forecasting the US economy in the … BVARs and DSGE-VARs. Compared to the SPF, the DSGE model generates better output forecasts at longer horizons, but less …

Persistent link: https://www.econbiz.de/10009640469

Optimal monetary policy under commitment with a zero bound on nominal interest rates

Adam, Klaus; Billi, Roberto M. - 2004

We determine optimal monetary policy under commitment in a forwardlooking New Keynesian model when nominal interest rates are bounded below by zero. The lower bound represents an occasionally binding constraint that causes the model and optimal policy to be nonlinear. A calibration to the U.S....

Persistent link: https://www.econbiz.de/10009639431

Optimal monetary policy under discretion with a zero bound on nominal interest rates

Adam, Klaus; Billi, Roberto M. - 2004

We determine optimal discretionary monetary policy in a New-Keynesian model when nominal interest rates are bounded below by zero. Nominal interest rates should be lowered faster in response to adverse shocks than in the case without bound. Such ‘preemptive easing’ is optimal because...

Persistent link: https://www.econbiz.de/10009639434

On approximating DSGE models by series expansions

Lombardo, Giovanni - 2010

We show how to use a simple perturbation method to solve non-linear rational expectation models. Drawing from the applied mathematics literature we propose a method consisting of series expansions of the non-linear system around a known solution. The variables are represented in terms of their...

Persistent link: https://www.econbiz.de/10009640275