The canonical new Keynesian Phillips Curve has become a standard component of models designed for monetary policy analysis. However, in the basic new Keynesian model, there is no unemployment, all variation in labor input occurs along the intensive hours margin, and the driving variable for...

A model of interest rate movements in response to new information on the money stock is developed.The model, which incorporates several earlier approaches as special cases, makes explicit the manner in which estimated interest rate responses to money surprises depend on the relative variances of...

The research literature in economics has explored the task of decision making under uncertainty and has developed theories about "precautionary" policies and "robust" policies. This Economic Letter summarizes some of the latest results and debates in this literature.