I study expectation driven liquidity traps in a model were agents have finite planning horizons and heterogeneous expectations. There are backward-looking agents, who base their expectations on past observations, and forward-looking agents, who observe the expectations of backward-looking...

We use simulations of the Federal Reserve's FRB/US model to examine the efficacy of a number of proposals for reducing the consequences of the zero bound on nominal interest rates. Among the proposals are: a more aggressive monetary policy; promises to make up any shortfall in monetary ease...