The central banking literature regards central bank independence and a transparent monetary policy as best suited to achieve and safeguard monetary stability. The existing empirical literature, however, failed in establishing a solid ground for this consensus. This paper sheds some new light on...

Recently, the U. S. subprime crisis has shown that a weak collateralization of credits may have massive economic implications, entailing severe perturbations of the international financial system. We focus on central bank lending and try to pin down the quantitative impact of the...

The economic crisis that began in 2007 and still lingers has invited comparison with the Great Depression of the 1930s. It has also generated renewed interest in Milton Friedman and Anna Schwartz's explanation of the latter as mainly the consequence of the Fed's failure as a lender of last...

"Should central banks, because of the zero-lower-bound problem, raise their inflation-rate targets? Several arguments are relevant. (1) In the absence of the ZLB, the optimal steady-state inflation rate, according to standard New Keynesian reasoning, lies between the Friedman-rule value of...