In a setting with a risk-adverse union, we study the effects of central bank's political transparency on wage level and inflation volatility according to its degree of conservativeness. We obtain some results that contrast with these obtained in the same kind of model or in a Rogoff type model...

In this paper, we propose two alternative formulations of representative consumer¡¯s endogenous time preference that depends on consumption as well as wealth and/or revenue. We solve one of these formulations and apply it to study the effectiveness of fiscal policies in a small open...

This paper studies the stability conditions in a simple dynamic economy model, in which central banks adopt an inflation-targeting regime to conduct their policy in a context of flexible exchange rates. We show that when inflation-targeting central banks place a low weight on their inflation...

Within a New Keynesian model subject to misspecification, we examine the quadratic contracts in a delegation framework where government and private agents are uncertain about central bank preferences for model robustness. We show that, in the case of complete transparency, the optimal penalty is...

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La crise financière globale récente a amené le Comité de Bâle sur le contrôle bancaire à revoir les Accords de Bâle II. De nouvelles régulations renforçant lâexigence en matière de fonds propres et de liquidité des banques et visant à limiter lâeffet de...

Lâépineux problème dâinteraction négative entre la crise de la dette souveraine et la crise bancaire au niveau national empêche une transmission efficace des effets de la politique monétaire unique et menace lâexistence même de la zone euro. En réponse à la crise de...

International commentators seem to have a consensus view that the Chinese yuan is substantially undervalued and the Chinese monetary authority must take speedy actions to redress the currency misalignment by rapid nominal revaluation. This paper argues for a gradualist but comprehensive strategy...

Using a New-Keynesian model subject to misspecifications, we examine how the robust monetary policy could be modified by a linear inflation contract when a central bank is opaque about its preference for model robustness. It is shown that a central bank must limit this preference and opacity...