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Input-output connections between sectors and optimal monetary policy

Kara, Engin - Nationale Bank van België/Banque national de Belqique (BNB) - 2009

This paper considers the monetary policy implications of a model that features input-output connections between stages of production, so that a distinction between CPI inflation and PPI inflation arises. More specifically, this paper addresses the policy conclusion by K. Huang and Z. Liu [2005,...

Persistent link: https://www.econbiz.de/10004984626

Price Versus Financial Stability: A role for money in Taylor rules?

Keating, John; Smith, Andrew Lee - Department of Economics, University of Kansas - 2013

This paper analyzes optimal monetary policy in a standard New-Keynesian model augmented with a financial sector. The banks in the model are subject to shocks which impede their ability and willingness to produce financial assets. We show these financial market supply shocks decrease both the...

Persistent link: https://www.econbiz.de/10010705595

Limited Asset Markets Participation, Monetary Policy and (Inverted) Keynesian Logic

Bilbie, Florin O. - Department of Economics, Oxford University - 2005

This paper incorporates limited asset markets participation in dynamic general equilibrium and develops a simple analytical framework for monetary policy analysis. Aggregate dynamics and stability properties of an otherwise standard business cycle model depend nonlinearly on the degree of asset...

Persistent link: https://www.econbiz.de/10010820337

Monerary Policy Response to Oil Price Shocks

Natal, Jean-Marc - Schweizerische Nationalbank (SNB) - 2010

How should monetary authorities react to an oil price shock? The New Keynesian literature has concluded that ensuring perfect price stability is optimal. Yet, the contrast between theory and practice is striking: Inflation targeting central banks typically favor a longer run approach to price...

Persistent link: https://www.econbiz.de/10008925017

Optimal monetary policy and downward nominal wage rigidity in frictional labor markets

Abo-Zaid, Salem - In: Journal of Economic Dynamics and Control 37 (2013) 1, pp. 345-364

This paper studies the optimal long-run inflation rate in a labor search and matching framework in the presence of downward nominal wage rigidity. Optimal monetary policy features positive inflation in the long run; the optimal annual long-run inflation rate for the U.S. economy is slightly...

Persistent link: https://www.econbiz.de/10011051955

Limited Asset Markets Participation, Monetary Policy and (Inverted) Keynesian Logic

Bilbiie, Florin - Economics Group, Nuffield College, University of Oxford - 2005

Persistent link: https://www.econbiz.de/10005730310

A quantitative analysis of optimal sustainable monetary policies

Sunakawa, Takeki - In: Journal of Economic Dynamics and Control 52 (2015) C, pp. 119-135

stabilization bias. As in Kurozumi (2008), the optimal sustainable policy is a strategy considered in the absence of commitment … technologies; however it is implemented following an optimal quasi-sustainable policy derived by assuming that the commitment … result basically identical to the Ramsey-optimal commitment policy under a set of parameters commonly used in the literature …

Persistent link: https://www.econbiz.de/10011209204

Optimal Time-Invariant Monetary Policy

Brendon, Charles - Department of Economics, Oxford University - 2009

This paper investigates how best to determine time-invariant policy rules in macroeconomic models with forward-looking constraints, where fully optimal policy is known to be time-inconsistent. It proposes a new 'coefficient optimisation' approach that improves upon the timeless perspective...

Persistent link: https://www.econbiz.de/10008471791

Optimal Monetary Policy Rules from a Timeless Perspective

Damjanovic, Tatiana; Damjanovic, Vladislav; Nolan, Charles - Centre for Dynamic Macroeconomic Analysis, University … - 2005

The timelessly optimal monetary policy proposed by Woodford (2003) may be dominated by alternative timeless policies. We provide a formal justification for these alternative policies. We demonstrate why discount rates do not matter and establish that optimizing over the unconditional expectation...

Persistent link: https://www.econbiz.de/10005696966

Central Bank Reputation in a Forward-Looking Model.

Loisel, O. - Banque de France - 2005

This paper examines whether reputation concerns can induce the central bank to implement the time-inconsistent optimal monetary policy in a standard New Keynesian model. The forward-looking nature of this model is in this respect interesting on two accounts: first, it worsens the...

Persistent link: https://www.econbiz.de/10005056519