Galí (2014) showed that a monetary policy rule that raises interest rates in response to bubbles can paradoxically lead … interest rates aggressively enough. This result is different from the Miao, Shen and Wang (2019) comment on Galí's paper. They … equilibria, more aggressive rules involve threats to raise interest rates more than actual rate increases. …

, financial stability has figured highly among central banks ́objectives, with policy measures ranging from interest rate …

interest rates and thereby redistributes wealth from creditors to borrowers. Because borrowers have a higher marginal utility …