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Downward nominal wage rigidity and the long-run Philips Curve
Coenen, Günter - 2003
the determination of inflation and output in the euro area and the existence of a non-vertical long-run Phillips curve …
Persistent link: https://www.econbiz.de/10009635901
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Price stability and monetary policy effectiveness when nominal interest rates are bounded at zero
Coenen, Günter; Orphanides, Athanasios; Wieland, Volker - 2003
target inflation rates as low as 2 percent. However, the effects of the constraint are non-linear with respect to the inflation … percent. The variability of output increases significantly and that of inflation also rises somewhat. Also, we show that the … increasingly short of potential with lower inflation targets. …
Persistent link: https://www.econbiz.de/10009635983
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Inflation persistence and robust monetary policy design
Coenen, Günter - 2003
This paper investigates the performance of optimised interest rate rules when there is uncertainty about a key determinant of the monetary transmission mechanism, namely the degree of persistence characterising the inflation process. The paper focuses on the euro area and utilises two variants of...
Persistent link: https://www.econbiz.de/10009635885
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Inflation targets and the liquidity trap
Klaeffling, Matt; Perez, Victor Lopez - 2003
The presence of a lower bound of zero on nominal interest rates has important implications for the conduct of optimal monetary policy. Standard rational expectations models can have alternative steady states as well as non-unique laws of motion, i.e. there can be possible sunspot equilibria....
Persistent link: https://www.econbiz.de/10009635903
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What determines fiscal balances?
Tujula, Mika; Wolswijk, Guido - 2004
Fiscal balances have deteriorated quickly in recent years, bringing back to the foreground the question what factors help explain such sharp changes. This paper takes a broad perspective at the issue regarding countries included, the range of explanatory variables tried, and the time-span. The...
Persistent link: https://www.econbiz.de/10009639483
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Definition of price stability, range and point inflation targets
Castelnuovo, Efrem; Nicoletti-Altimari, Sergio; … - 2003
help anchoring inflation expectations. We use survey data on long-term inflation expectations in 15 industrial countries … since the early nineties to investigate how well anchored are inflation expectations. We find that in all countries except … Japan long-term inflation expectations are well anchored and, generally, increasingly so over the past decade. When …
Persistent link: https://www.econbiz.de/10009635904
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Zero lower bound
Coenen, Günter - 2003
such as the shortterm nominal interest rate, annual inflation and output. …
Persistent link: https://www.econbiz.de/10009635906
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The optimal degree of discretion in monetary policy
Athey, Susan; Atkeson, Andrew; Kehoe, Patrick J. - 2004
inconsistency problem arising from the temptation to stimulate the economy with unexpected inflation. Although this dynamic … mechanism design problem seems complex, society can implement the optimal policy simply by legislating an inflation cap that … specifies the highest allowable inflation rate. The more severe the time inconsistency problem, the more tightly the cap …
Persistent link: https://www.econbiz.de/10009639392
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Optimal monetary and fiscal policy
Benigno, Pierpaolo; Woodford, Michael - 2004
We propose an integrated treatment of the problems of optimal monetary and fiscal policy, for an economy in which prices are sticky and the only available sources of government revenue are distorting taxes. Our linear-quadratic approach allows us to nest both conventional analyses of optimal...
Persistent link: https://www.econbiz.de/10009639399
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Exchange-rate policy and the zero bound on nominal interest rates
Coenen, Günter; Wieland, Volker - 2004
In this paper, we study the effectiveness of monetary policy in a severe recession and deflation when nominal interest rates are bounded at zero. We compare two alternative proposals for ameliorating the effect of the zero bound: an exchange-rate peg and price-level targeting. We conduct this...
Persistent link: https://www.econbiz.de/10009639404