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Implementation of monetary policy assumes that monetary policy instruments stabilize O/N interest rates to the proximity of main policy rate to archive monetary targets. The function of stabilizing me...
In this note we extend the search-based monetary DSGE model studied in Aruoba and Schorfheide (2010) and introduce liquid capital claims. More specifically, buyers in the decentralized market can use ...
We develop a two-sector monetary model with a centralized and decentralized market. Activities in the centralizedmarket resemble those in a standard New Keynesian economy with price rigidities. In the...
Ináation expectations have recently received increased interest because of the uncertainty created by the Federal Reserveís unprecedented reaction to the Great Recession.The effect of this reaction on...
We study optimal fiscal and monetary policy in an environment where explicit frictions giverise to valued money, making money essential in the sense that it expands the set of feasible trades. The two...
We introduce household production and the production of houses (construction) into a monetary model. Theory predicts inaation, as a tax on market activity, encourages substitution into household produ...
Fiscal and Monetary Stabilization Policies in a Model of Endogenous Cyclical Growth.
The potential of monetary policy to stabilize fluctuations in output and employment is demonstrated in a stochastic rational expectations model in which firms choose, considering average profitabili...
Stabilization, Accommodation, and Monetary Rules.
There has probably never been a consensus among economists about the role of expectations in formulating monetary policy. Today two widely different views seem to dominate policy research and practi...
Comments on ‘Rules, Discretion and Reputation in a Model of Monetary Policy’ by R.J. Barro and D.B. Gordon.
Comments on ‘Rules, Discretion and Reputation in a Model of Monetary Policy’ by R.J. Barro and D.B. Gordon.
Wage Determination and Monetary Policy.
After nearly a quarter century of large budget deficits—causing the public debt to double from 20 percent to 42 percent as a share of GDP in the industrialized countries—the need for greater fiscal ...

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