The authors investigate an international monetary business-cycle model in which agents face monetary policy processes that incorporate regime shifts. In any given period agents cannot directly observe the policy regime, but instead form beliefs that are updated via Bayesian learning. As a...

This paper investigates an international monetary business-cycle model in which agents face monetary policy processes that incorporate regime shifts. In any period, agents cannot directly observe the policy regime, but, instead, form beliefs that are updated through Bayesian learning. Monetary...