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This paper presents a welfare analysis of a desirable Inflation Targeting Policy in order to achieve price stabilization and an efficient level of output under a deflationary economy. Concretely, we present a general model that can treat the components of a Inflation Targeting Policy, such as...
Persistent link: https://www.econbiz.de/10013037875
Paul Krugman has argued that Japan is in a liquidity trap and that it can recover only if the central bank there … result his policy recommendations can result in neither the elimination of the trap nor in Japan's economic recovery …
Persistent link: https://www.econbiz.de/10014162273
We construct a continuous-time, New-Monetarist economy that displays an endogenous, non-degenerate distribution of money holdings. Properties of equilibria are obtained analytically and equilibria are solved in closed form in a variety of cases. Lump-sum transfers financed with money creation...
Persistent link: https://www.econbiz.de/10011937389
Using panel data models, we analyze the flypaper effects-whether intergovernmental fiscal transfers or states' own income determine expenditure commitments - on ecological fiscal spending in India. The econometric results show that the unconditional fiscal transfers, rather than the states' own...
Persistent link: https://www.econbiz.de/10012596963
Historically, inflation is negatively correlated with stock returns, leading investors to fear inflation. We document using a variety of measures that this association became positive in the U.S. during the 2008-2015 period. We then show how an off-the-shelf New Keynesian model can reproduce...
Persistent link: https://www.econbiz.de/10012150291
The implementation of economic reforms under new economic policies in India was associated with a paradigmatic shift in monetary and fiscal policy. While monetary policies were solely aimed at "price stability" in the neoliberal regime, fiscal policies were characterized by the objective of...
Persistent link: https://www.econbiz.de/10010385761
We use narrative evidence along with a novel database of real-time data and forecasts from the Bank of Canada's staff economic projections from 1974 to 2015 to construct a new measure of monetary policy shocks and estimate the effects of monetary policy in Canada. We show that it is crucial to...
Persistent link: https://www.econbiz.de/10011777945
This paper econometrically models the dynamics of Swedish government bond (SGB) yields. It examines whether the short-term interest rate has a decisive influence on long-term SGB yields, after controlling for other macroeconomic and financial variables, such as consumer price inflation, the...
Persistent link: https://www.econbiz.de/10014517317
The zero lower bound on nominal interest rates constrains the central bank's ability to stimulate the economy during downturns. We use the FRB/US model to quantify the effects of the bound on macroeconomic stabilization and to explore how policy can be designed to minimize these effects. During...
Persistent link: https://www.econbiz.de/10014181390
Persistent link: https://www.econbiz.de/10001551669