degrees of credibility, in which commitment and discretion become special cases of what we call quasi commitment. The monetary … for only 6 quarters is enough to bridge 75% of the welfare gap between discretion and commitment. This seems to justify … measure of the (lack of) credibility of the monetary policy authority, we investigate the welfare effect of a marginal …

serves as a substitute for commitment, enabling the central bank to achieve the efficient Ramsey equilibrium and avoid the … inefficient, time-inconsistent one-shot Nash equilibrium. We find that reputation is a poor substitute for commitment. We then … that these mechanisms have only small or transitory effects on welfare. Surprisingly, the real effects of supply shocks are …

modes of optimization, termed commitment and discretion. I estimate the model separately under each policy using maximum … commitment model but a more balanced concern relative to inflation and output stability in the discretionary model. …

the policy maker acts under pure discretion. We apply a framework developed by Schaumburg and Tambalotti (2007) and … traps under limited commitment and identify the minimum degree of commitment which is needed to escape from these traps. We …

, which arise if the policy maker acts under pure discretion. We apply a framework developed by Schaumburg and Tambalotti … of expectation traps under limited commitment and identify the minimum degree of commitment which is needed to escape …

multiple equilibria under pure discretion, and under full commitment there are two distinct determinate regimes. We study how … these properties change over the continuum of intermediate cases between commitment and discretion. We find that although …We study the existence and uniqueness properties of monetary policy with limited commitment in LQ RE models. We use a …

multiple equilibria under pure discretion, and under full commitment there are two distinct determinate regimes. We study how … these properties change over the continuum of intermediate cases between commitment and discretion. We find that although …We study the existence and uniqueness properties of monetary policy with limited commitment in LQ RE models. We use a …

periodic reviews and adaptation. Replacing meeting-by-meeting discretion with a simple policy rule would eschew discretion in …