Tambalotti, Andrea; Schaumburg, Ernst - Econometric Society - 2004
degrees of credibility, in which commitment and discretion become special cases of what we call quasi commitment. The monetary … policy authority is assumed to formulate optimal commitment plans, to be tempted to renege on them, and to succumb to this … from commitment accrue at relatively low levels of credibility. In our benchmark calibration, a commitment expected to last …