Optimal Monetary Stabilization Policy

(PDF) Principles of Optimal Stabilization Policy - ResearchGate

In this article, we derive principles of optimal stabilization policy. We show that optimal policy in re- sponse to shocks keeps prices stable, ...

Optimal monetary and fiscal policy: a linear-quadratic approach

Our linear-quadratic approach allows us to nest both conventional analyses of optimal monetary stabilization policy and analyses of optimal tax-smoothing as ...

Comment on Optimal Fiscal and Monetary Policy ... - MIT Economics

2 At the same time, the New Keynesian literature has noted that fiscal policy could in principle help stabilize output by offsetting cyclical variation in ...

Optimal Monetary Policy with Heterogeneous Agents - YouTube

Conference in Honor of Emmanuel Farhi. Optimal Monetary Policy with Heterogeneous Agents : A Timeless Ramsey Approach by Eduardo Davila ...

Bounded Rationality in Macroeconomics - Columbia Blogs

Fiscal and Monetary Stabilization Policy at the Zero Lower Bound: Consequences of Limited Foresight · Robustly Optimal Monetary Policy in a New Keynesian Model ...

Optimal Monetary and Fiscal Policy in a Currency Union - CREI

First, we show that it is optimal for the (common) monetary authority to stabilize inflation in the union as a whole. Attaining that goal generally requires ...

How Macroeconomists Lost Control of Stabilization Policy

The Economic Journal 91(363), 647 -670. Calvo, G. A. (1978). On the Time Consistency of Optimal Policy in a Monetary Economy. Econometrica 46(6) ...

Price-Level Targeting and Stabilization Policy - jstor

optimal monetary stabilization policy. Prices are fully flexible and money is essential for trade. Our main result is that if the central bank pursues a.

Speed Limit Policies: The Output Gap and Optimal Monetary Policy

And while optimal inflation targeting involves appointing a weight-conservative central banker who values inflation stability. 3. Page 4. more highly than does ...

How Macroeconomists Lost Control of Stabilization Policy - HAL-SHS

Holt (1962) developed an optimal control model to analyze fiscal and monetary policy. Kalman (1930-2016), an electrical engineer, wrote the key ...

Research Publications - Klaus Adam

When firms' prices are strategic complements and economic shocks display little persistence, monetary policy has strong real effects, making it optimal to ...

Price level targeting and stabilization policy - edoc

We construct a dynamic stochastic general equilibrium model to study optimal monetary stabilization policy. Prices are fully flexible and ...

Optimal Monetary Policy in a Small Open Economy with Home Bias

This paper suggests that, in the presence of home bias, the conditions for markup stability to be constrained-effi cient are more restrictive: in particular, a ...

Price-Level Targeting and Stabilization Policy: A Review

The New Keynesian model can be used to derive the optimal monetary policy for a central bank that sets short-term nominal interest rates in order to reduce the ...

Price‐Level Targeting and Stabilization Policy - BERENTSEN - 2011

We construct a dynamic stochastic general equilibrium model to study optimal monetary stabilization policy. Prices are fully flexible and ...

Stabilization Policy: A Framework for Analysis - Research Database

macroeconomic stabilization policy. Topics studied include the relative strength of fiscal and monetary policy, the effect of lags on optimal policy, the ...

The role of the inflation target adjustment in stabilization policy

We study optimal monetary policy in a New Keynesian model in which the monetary authority faces a trade-off between inflation and output-gap stabilization ...

Inflation Expectations, Adaptive Learning and Optimal Monetary Policy

They do not create a trade-off between inflation and output gap stabilization and are, therefore, fully offset by changes in policy interest rates. 3 See Evans ...

A Dynamic Optimization Model of Monetary Stabilization Policy Ken ...

... monetary policy is deviating from the optimal path. Keywords: Optimal monetary policy, Taylor Rule, (in)stability, dynamic optimization, inflation ...

Optimal Monetary Policy, Commitment, and Imperfect Credibility* A ...

Keywords: Optimal Monetary Policy, Stabilization Bias, Imperfect Credibility, Discretion, Commitment. * I am grateful to Pierpaolo Beningo for many ...