Sustainable monetary policies

Article Abstract:

A study presents a model for evaluating time consistency of monetary policies. The model presents, in particular, a government operating that is consistent with a representative household's utility function faced with a trade-off between costs of expected inflation and the benefits of unexpected inflation. The optimal policy under commitment, which is determined by the Friedman rule, can obtain support from a reputational equilibrium without commitment.

Econometrics & Model Building, Economic aspects, Econometrics, Business models, Time perspective

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Optimal disinflationary paths

Article Abstract:

A general equilibrium model with optimum agents and staggered prices is considered in examining optimal monetary policy. Credible monetary policy in a steady economy with positive inflation would be conducive for rapid disinflation. Output and employment suffer from disinflationary policies of a monetary authority lacking in credibility. However, the benefits of disinflation still exceed the costs.

Inflation (Finance), Inflation (Economics)

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Technology shocks and the business cycle: an empirical investigation

Article Abstract:

Research constructing a business cycle model in relation to technological change is presented. Particular attention is given to benefits of using the estimation approach, including using formal statistical tests of hypothesis in discriminating between specifications.

Models, Business cycles

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