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Hagenhoff, Tim; Lustenhouwer, Joep - 2019

We analyze differences in consumption and wealth that arise because of different degrees of rationality of households. In particular, we use a standard New Keynesian model and let a certain fraction of households be fully rational while the other fraction possesses less cognitive ability. We...

Persistent link: https://www.econbiz.de/10011979254

Forward-Looking Monetary Policy and Anticipated Shocks to Inflation

Kapinos, Pavel S. - 2011

This paper extends a standard New Keynesian model to describe the effects of anticipated shocks to inflation and forward-looking monetary policy. Using the data generated from this modified model suggests that overlooking these two factors in the standard Cholesky structural vector...

Persistent link: https://www.econbiz.de/10013123948

Real and Nominal Effects of Monetary Shocks Under Time-Varying Disagreement

Esady, Vania - 2019

This paper investigates the heterogeneity of monetary policy transmission under time-varying disagreement regimes using a threshold VAR. Empirically, I establish that during times of high disagreement, prices respond more sluggishly in response to monetary shocks. These stickier prices cause a...

Persistent link: https://www.econbiz.de/10012858703

Asymmetric Expectation Effects of Regime Shifts and the Great Moderation

Liu, Zheng - 2015

The possibility of regime shifts in monetary policy can have important effects on rational agents' expectation formation and equilibrium dynamics. In a dynamic stochastic general equilibrium model where the monetary policy rule switches between a dovish regime that accommodates inflation and a...

Persistent link: https://www.econbiz.de/10013032865

Modeling Monetary Policy

Reynard, Samuel; Schabert, Andreas - 2009

We develop a macroeconomic framework where money is supplied against only few eligible securities in open market operations. The relationship between the policy rate, expected inflation and consumption growth is affected by money market conditions, i.e. the varying liquidity value of eligible...

Persistent link: https://www.econbiz.de/10014201103

Real and nominal effects of monetary shocks under time-varying disagreement

Esady, Vania - 2023

How do varying degrees of information frictions affect the transmission mechanism of monetary policy? Using non‑linear methods, I empirically find that during heightened disagreement, monetary policy has a smaller effect on inflation, yet more influence over output. As a proxy for information...

Persistent link: https://www.econbiz.de/10014257820

Inflation expectations spillovers between the United States and euro area

Netšunajev, Aleksei; Winkelmann, Lars - 2014

We quantify spillovers of inflation expectations between the United States (US) and Euro Area (EA) based on break … autoregressive (SVAR) model. The SVAR approach allows to identify US and EA specific inflation expectations shocks. By modeling the …. Adjusted for BEI risk premia, our main result suggests that spillovers of inflation expectations increase during times of …

Persistent link: https://www.econbiz.de/10010255370

The Credibility of Monetary Policy Announcements – Empirical Evidence for OECD Countries Since the 1960s

Belke, Ansgar Hubertus - 2012

Monetary policy rules have been considered as fundamental protection against inflation. However, empirical evidence for a correlation between rules and inflation is relatively weak. In this paper, we first discuss likely causes for this weak link and present the argument that monetary commitment...

Persistent link: https://www.econbiz.de/10013102702

The Credibility of Monetary Policy Announcements : Empirical Evidence for OECD Countries Since the 1960s

Belke, Ansgar Hubertus - 2012

Persistent link: https://www.econbiz.de/10013103579

Central Bank Credibility and the Expectations Channel : Evidence Based on a New Credibility Index

Levieuge, Grégory - 2016

negative effect of credibility on the volatility of the short-term interest rate. Thus, in line with the expectations channel …This article investigates the relationship between central bank credibility and the volatility of the key monetary … policy instrument. Two main contributions are proposed. First, we propose a time-varying measure of central bank credibility …

Persistent link: https://www.econbiz.de/10013003866