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Carr, Douglas - 2012

This paper applies a yield curve model that separates expectations and volatility components of market yields on default-free bonds. Expected future riskless rates derived from the model are unbiased, reasonably accurate indicators of subsequent actual riskless rates for periods up to three...

Persistent link: https://www.econbiz.de/10013116388

Monetary Equilibrium and Price Stickiness Reconsidered : A Reply to Bagus and Howden

Luther, William J. - 2014

Bagus and Howden (2011) argue that price stickiness is a poor justification for advocating a flexible money supply through the issuing of fiduciary media under central or free banking. They view the contraction in output following an exogenous increase in money demand as an optimal response,...

Persistent link: https://www.econbiz.de/10013066751

Optimal Monetary Policy in a Currency Union : Should a Central Bank Care about Output Stabilization?

Thams, Andreas - 2008

In this paper we derive optimal monetary targeting rules under various assumptions about fiscal behavior. In contrast to the existing literature we use a linear-quadratic approach and allow for dynamic games between the two policy authorities. It is shown that optimal monetary behavior is...

Persistent link: https://www.econbiz.de/10012726512

Credit Risk, Excess Reserves and Monetary Policy : The Deposits Channel

Bratsiotis, George - 2018

independent of precautionary liquidity, or the fiscal theory of the price level …This paper examines the role of precautionary liquidity (reserves) and the interest on reserves as two potential …

Persistent link: https://www.econbiz.de/10012930610

Monetary Misperceptions : Optimal Monetary Policy Under Incomplete Information

Halperin, Basil - 2018

Inflation targeting is strictly suboptimal when economic actors have incomplete information about the state of the economy. Nominal income targeting is approximately optimal, and exactly optimal under certain parameterizations. We derive this result in a “Lucas islands” monetary...

Persistent link: https://www.econbiz.de/10012933106

Inflation Taxes and Inflation Subsidies : Explaining the Twisted Relationship between Inflation and Output

McCandless, George - 2010

This paper studies the nature of monetary policy in a cash-in-advance model with indivisible labor and with financial intermediaries that provide loans for working capital. Monetary policy occurs through money injections either directly to families or to financial intermediaries. Injections to...

Persistent link: https://www.econbiz.de/10013147621

The Role of Transparency in the Conduct of Monetary Policy

Minegishi, Makoto - 2009

In contrast to the once prevailing norm of secrecy and opaqueness, transparency has now become one of the main features characterising the conduct of monetary policy. Detailed analysis of eleven OECD central banks shows that communication practices have converged markedly in the direction of...

Persistent link: https://www.econbiz.de/10012447068

Credit risk, excess reserves and monetary policy : the deposits channel

Bratsiotis, George - 2017 - This Version: 25 January 2018

This paper examines the role of the precautionary demand for liquidity and the interest on reserves as two potential … high levels of precautionary liquidity hoarding the optimal policy response of a Taylor rule is shown to indicate a zero … weight on inflation. This result is explained by the effect that the demand for liquidity has on the deposit rate which …

Persistent link: https://www.econbiz.de/10011810801

Inflation Targeting and Nominal-Income-Growth Targeting : When and Why are They Suboptimal?

Kim, Jinill; Henderson, Dale W. - 2005

We compare optimal and simple interest-rate rules. Our model features optimizing agents, monopolistic competition in both product and labor markets, and one-period nominal contracts (for wages alone or for both wages and prices) signed before shocks are known. Exact solutions insure that we...

Persistent link: https://www.econbiz.de/10014066671

Monetary Policy, Nominal Interest Rates, and Long-Horizon Inflation Uncertainty

Wright, Stephen H. - 1999

considerably across countries. Both simple theory and empirical evidence suggest that the crucial factor is the extent to which …

Persistent link: https://www.econbiz.de/10014208831