Debates about the conduct of monetary policy have evolved over time from “rules versus discretion” to “policy rules versus constrained discretion.” We propose a metric to evaluate monetary policy rules that are consistent with constrained discretion by calculating quadratic loss ratios,...

This paper develops a theoretical model that identifies the relationship between the volatility of private sector wages and growth. The model suggests two distinct channels in which wage volatility affects growth: a positive direct way and a negative indirect way. The direct effect stems from...