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The impact of heterogeneity on indeterminacy

Ghiglino, Christian; Olszak-Duquenne, Marielle - Department Volkswirtschaftlehre, Universität Bern - 2002

The aim of the paper is to explore the link between agent's heterogeneity and indeterminacy in a general equilibrium … (1994) in which heterogeneous agents are introduced. We first show that the occurrence of indeterminacy depends on the … find that the sign of the effect of heterogeneity on indeterminacy is not pinned down by the standard properties of …

Persistent link: https://www.econbiz.de/10005730941

A method to generate structural impulse-responses for measuring the effects of shocks in structural macro models

Beyer, Andreas; Farmer, Roger E. A. - European Central Bank - 2006

We develop a technique for analyzing the response dynamics of economic variables to structural shocks in linear rational expectations models. Our work differs fromstandard SVARs since we allow expectations of future variables to enter structural equations. We show how to estimate the...

Persistent link: https://www.econbiz.de/10005816140

Monetary policy, determinacy, and learnability in the open economy

Bullard, James; Schaling, Eric - European Central Bank - 2006

We study how determinacy and learnability of global rational expectations equilibrium may be affected by monetary policy in a simple, two country, New Keynesian framework. The two blocks may be viewed as the U.S. and Europe, or as regions within the euro zone. We seek to understand how monetary...

Persistent link: https://www.econbiz.de/10005816181

On the indeterminacy of determinacy and indeterminacy

Beyer, Andreas; Farmer, Roger E. A. - European Central Bank - 2003

A number of authors have attempted to test whether the U.S. economy is in a determinate or an indeterminate equilibrium. We argue that to answer this question, one must impose a priori restrictions on lag length that cannot be tested. We provide examples of two economic models. Model 1 displays...

Persistent link: https://www.econbiz.de/10005816208

The great inflation of the 1970s

Collard, Fabrice; Dellas, Harris - European Central Bank - 2004

Was the high inflation of the 1970s mostly due to incomplete information about the structure of the economy (an unavoidable mistake as suggested by Orphanides, 2000)? Or, to weak reaction to expected inflation and/or excessive policy activism that led to indeterminacies (a policy mistake, a...

Persistent link: https://www.econbiz.de/10005816223

Indeterminacy of rational expectations equilibria in sequential financial markets

Donati, Paola - European Central Bank - 2003

JEL Classification: D52, D80, D82, E52

Persistent link: https://www.econbiz.de/10005816309

Openness and equilibrium determinacy under interest rate rules

De Fiore, Fiorella; Liu, Zheng - European Central Bank - 2002

This paper shows that the conditions under which inflation-targeting interest rate rules lead to equilibrium uniqueness in a small open economy in general differ from those in a closed economy. As the monetary authority adjusts nominal interest rates in response to inflation, the real interest...

Persistent link: https://www.econbiz.de/10005816320

On Impossibility of Limit Cycles in Certain Two-Dimensional Continuous-Time Growth Mode

Slobodyan, Sergey - In: Studies in Nonlinear Dynamics & Econometrics 5 (2007) 1, pp. 33-40

This article proves that periodic trajectories are generically impossible in a class of continuous-time growth models that allow a locally indeterminate steady state. Those models reducible to the two-dimensional Lotka-Volterra system of equations constitute the class considered here. Knowledge...

Persistent link: https://www.econbiz.de/10004966152

Business Cycles with Free Entry Ruled by Animal Spirits

Dos Santos Ferreira, Rodolphe; Lloyd-Braga, Teresa - C.E.P.R. Discussion Papers - 2003

The Paper approaches business cycles in terms of extrinsic uncertainty related, not to dynamic indeterminacy of … static indeterminacy of free entry oligopolistic equilibria within each period. We consider an OLG economy in which firms … dynamic indeterminacy, we can weaken the condition on the degree of increasing returns, which may be arbitrarily small (with a …

Persistent link: https://www.econbiz.de/10005789194

Monetary policy rules and indterminacy

Sosunov, Kirill; Khramov, Vadim - Volkswirtschaftliche Fakultät, … - 2008

, active monetary policy (MP) rules can lead to indeterminacy under various assumptions about the structure of the model. We … analyze the conditions for real indeterminacy to occur in the model with capital accumulation. The key assumption is that we … substantially changes the conditions for real indeterminacy to occur. In contrast to some existing research we show that under …

Persistent link: https://www.econbiz.de/10005789610