Purpose: In this paper, the authors develop and estimate a small open economy dynamic stochastic general equilibrium (DSGE) model with an enriched micro-founded specification to account for foreign remittances, an important source that helps bridge the trade gap in many developing and emerging...

Purpose: The conventional and new inflation bias theories present two distinct facets to explain the outcome of excess inflation without output gains by a discretionary central banker. First is the temptation to achieve a higher than potential output, and, second is not to let it falter. The...

This paper empirically assesses the pros and cons that emanates when the discretionary monetary policy maker aims to achieve the dual objectives of inflation and output. In order to facilitate theoretically plausible empirical analysis a typical case of a discretionary monetary policy s of a...