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There is an important interdependence between economic, financial and health policy actions. The recent Covid-19 crisis has demonstrated that, apart from the direct economic consequences from illness and death from the virus, the main economic and financial costs have been due to the varying...
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In a setting with dispersed information, monopolistic competition and sticky-prices, a policy authority uncertain about the monetary transmission mechanism reacts prudently to supply shocks. This induces producers to ascribe an excessive importance to their private information when setting...
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Using traditional monetary policy measures, Bekaert et al. (2013) show that a lax monetary policy decreases both risk … aversion and uncertainty and that positive shocks to risk aversion and uncertainty induce monetary policy changes. We extend …
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uncertainty. In this paper, we explore monetary policy decision-making under risk and uncertainty within an insurance model with … to take better monetary policy decisions than single policy-makers. We also show that, in the presence of risk and search … practice, whether a monetary policy committee sufficiently hedges against this risk, may depend on several factors such as the …
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