What are the long-run aggregate effects of monetary shocks displaying throughthe credit channel of monetary policy? We address this question by investigatingthe transmission mechanism and estimating the dynamic behaviour of variablesrelated to credit and innovation. Then, we develop a DSGE model...

We study the extent to which the belief-formation process affects the dynamics of macroeconomic variables when the central bank uses forward guidance. Standard sticky-price models imply that far future forward guidance has huge and implausible effects on current outcomes, these effects grow in...

This paper adds to the large literature on the effects of technology shocks empirically and theoretically. Using a SVEC model, we first show that not only hours but also investment decline temporarily following a technology improvement. This result is robust with respect to important data and...

This paper develops and estimates a simple New Keynesian Dynamic Stochastic General Equilibrium (DSGE) model with rule-of-thumb consumers and external habits. Our theoretical model has a closed-form solution which allows the analytical derivation of its dynamical and stability properties. These...