This paper studies optimal monetary policy with the nominal interest rate as the single policy instrument in an economy,where firms set prices in a staggered way without indexation and real money balances contribute separately to households'utility. The optimal deterministic steady state under...

This paper studies optimal monetary policy with the nominal interest rate as the single policy instrument in an economy,where firms set prices in a staggered way without indexation and real money balances contribute separately to households'utility. The optimal deterministic steady state under...

Criticism of the course followed by the Deutsche Bundesbank has been increasing recently. Professor Dr. Otmar Issing explains the theoretical concept of German monetary policy and the basic principles of the Bundesbank's monetary targeting.