This paper present a variety of approaches to estimating error-correction relationships between CPI inflation and selected commodity price indices, based on their ability to to forecast out-of-sample predictions of CPI inflation. Depending on specification, commodity prices have marginal value...

This paper introduces an empirical measure of the cost of allocating money market volatility between the money stock and the Federal funds rate, the principal purpose being to devise a framework for data-based measures of the short-run implied by alternative operating procedures

Recently, a number of reforms in the treatment of corporate profits have been proposed in the US, including (1) reducing or eliminating interest rate deductibility, (2) allowing full or partial dividend deductibility (full or partial imputation), and (3) permitting tax payers to credit corporate...

This paper studies how and why announcing and maintaining a price freeze, such as implemented between 1971 and 1973, can backfire. The vehicle for this analysis is a monopolistic firm that is shown to reduce output and raise price in anticipation of a price freeze, depending on the length of the...

This paper is a contribution to the sticky-price literature based on an assumption that a monopolist is constrained in setting prices instantaneously because of an announcement effect whereby consumers respond negatively to large price increases. In effect, demand becomes a function of price and...

This paper presents an equation of the dynamic path of prices in a monopolistically competitive market in which firms sell to both old and new customers. Both types are able to search for the lowest price, given search costs, where the expected number of searches is given by the inverse of the...

This paper derives the dynamic implications for price setting in an Edgeworth oligoppoly game with N2 competitors. The impetus to the dynamic game are "conjectured" variations in the prices set by competing firms whereby each firm expresses its belief that a decrease in its own price will be met...

Traditionally, in the Federal Reserve's Open Market statements, the planned Federal Funds rate is set to be contained within well defined bands and not a given single value, so that the funds rate is able to vary freely within that range without interference.This paper provides an explanation of...

The conclusions of a logically consistent economic theory which strictly adheres to Aristotle's axioms of logic are factually true if its sufficient conditions are all factually true. Alternatively, if a conclusion of such a theory is false, then at least one of its assumptions is false....

This paper, written for a Federal Reserve Staff Review of Monetary Control Procedures, explores the short-run volatility consequences of money stock targeting procedures under current (1981) alternative operating procedures. Conclusions include: the odds are at least two to one that a portion of...