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labor share of income. I show that this channel is generally absent in standard macroeconomic models that do not take risk …
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-agents model with two main ingredients: i) rare disasters; ii) heterogeneous beliefs. The model captures time-varying risk premia …
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The key insight from this analysis is that monetary policy should be responding more to negative shocks than positive shocks: optimal monetary policy is asymmetric. Moreover, if we take the stance that asset prices indicate a high cost of exposure to long-run risks, this has very interesting...
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: risk-averse lenders and lack of monetary policy commitment. A government without commitment chooses excessively counter …-cyclical inflation ex post, which leads risk-averse lenders to require a risk premium ex ante. This makes local currency debt too …
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: risk-averse lenders and lack of monetary policy commitment. A government without commitment chooses excessively counter …-cyclical inflation ex post, which leads risk-averse lenders to require a risk premium ex ante. This makes local currency debt too …
Persistent link: https://www.econbiz.de/10012983672