Evidence from monetary VARs for ten countries points towards an unfavorable trade-off between leaning against credit fluctuations and stabilizing real economic activity. Results are robust both across countries, and based on two alternative approaches, i.e. either (i) focusing on the impact of...

Data from 20 hyperinflations - from the French Revolution to Venezuela's 2018 episode - provide nearly no evidence of a Laffer curve for seignorage. Rather, in nearly all cases, the relationship between the inflation tax and inflation has been either positive at all inflation rates, or initially...

Evidence from low-frequency regressions for 27 countries since the XVIII century suggests that the relationship between broad money growth and inflation has been mostly one-for-one, and largely invariant to changes in the monetary regime. There is little evidence that the relationship had been...

We explore the long-run demand for M1 based on a dataset comprising 32 countries since 1851. We report six main findings: (1) Evidence of cointegration between velocity and the short rate is widespread. (2) Evidence of breaks or time-variation in cointegration relationships is weak to...

Chahrour and Jurado (2018) have shown that news and noise shocks are observationally equivalent when the econometrician only observes a fundamental process and agents' expectations about it. We show that the observational equivalence result no longer holds when the econometrician observes a...

We make two contributions to the literature exploring the role of sentiment in macroeconomic fluctuations: (I) Working with the theoretical MA representations of standard DSGE models, we show that several SVAR-based approaches to the identification of sentiment shocks are unreliable, as (e.g.)...

We make four contributions to the "news versus noise" literature: (I) We provide a new identification scheme which, in population, exactly recovers news and noise shocks. (II) We show that our scheme is not vulnerable to Chahrour and Jurado's (2018) criticism about the observational equivalence...

Based on either Monte Carlo simulations, or several examples based on actual data, I show that the ability of Johansen's tests to detect a cointegration relationship significantly deteriorates under two empirically plausible circumstances: (i ) when, in addition to a cointegration relationship,...