Using long, low frequency data on money and output over 1884-1996 for Argentina and over 1912-1995 for Brazil, it is found that money is long-run neutral but not long-run superneutral with regard to real output. A rise in money growth is associated with a decline in output - the opposite of the...

Distortions introduced by targeting nominal income growth, or an exchange rate peg, in the trade-off between inflation and output in the stabilization of shocks to supply and terms of trade cannot be eliminated simultaneously. If supply shocks are optimally stabilized, targeting an exchange rate...

This paper investigates the performance of inflation indicators for predicting the probability of inflation falling inside or outside constant and moving target ranges with a probit model for U.S. data. Particular attention will be given to the moving target range that future inflation will be...

We present a model in which investors observe the same macroeconomic data but have varying levels of information about the parameters that determine the distribution of the expected returns on investment. During a crisis that increases macroeconomic uncertainty and reduces asset prices, the...

In this paper we argue that an oil price change is likely to have greater impact on real GNP in an environment where oil prices have been stable, than in an environment where oil price movement has been frequent and erratic. An oil price shock variable reflecting both the unanticipated component...

This paper analyses the implications of adding a foreign exchange rate term to the loss function in the standard model for the issues of discretion and commitment in monetary policy. It is found that neither a linear state-contingent inflation contract for the central bank nor an explicit...