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The assumption of asymmetric and incomplete information in a standard New Keynesian model creates strong incentives for monetary policy transparency. We assume that the central bank has better information about its objectives than the private sector, and that the private sector has better...
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"This paper develops a theory of expectations-driven business cycles based on learning. Agents have incomplete … series is captured, unlike in standard models. Inherited from real business cycle theory, the benchmark model suffers a …
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