Author: Riccardo M. MasoloPublisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
Ambiguity, Monetary Policy and Trend Inflation
Author: Riccardo M. MasoloMonetary Policy Mistakes and the Evolution of Inflation Expectations
Author: Athanasios OrphanidesPublisher: DIANE Publishing
ISBN: 1437935613
Category : Business & Economics
Languages : en
Pages : 46
Book Description
What monetary policy framework, if adopted by the Federal Reserve, would have avoided the Great Inflation of the 1960s and 1970s? The authors use counterfactual simulations of an estimated model of the U.S. economy to evaluate alternative monetary policy strategies. The authors document that policymakers at the time both had an overly optimistic view of the natural rate of unemployment and put a high priority on achieving full employment. They show that in the presence of realistic informational imperfections and with an emphasis on stabilizing economic activity, an optimal control approach would have failed to keep inflation expectations well anchored, resulting in highly volatile inflation during the 1970s. Charts and tables.
Monetary Policy, Trend Inflation and Inflation Persistence
Author: Fang YaoLearning about a Shift in Trend Output
Author: Kevin J. LansingPublisher:
ISBN:
Category : Business cycles
Languages : en
Pages : 58
Book Description
The Monetary Policy of the Federal Reserve
Author: Robert L. HetzelPublisher: Cambridge University Press
ISBN: 1139470647
Category : Political Science
Languages : en
Pages : 7
Book Description
Details the evolution of the monetary standard from the start of the Federal Reserve through the end of the Greenspan era. The book places that evolution in the context of the intellectual and political environment of the time. By understanding the fitful process of replacing a gold standard with a paper money standard, the conduct of monetary policy becomes a series of experiments useful for understanding the fundamental issues concerning money and prices. How did the recurrent monetary instability of the 20th century relate to the economic instability and to the associated political and social turbulence? After the detour in policy represented by FOMC chairmen Arthur Burns and G. William Miller, Paul Volcker and Alan Greenspan established the monetary standard originally foreshadowed by William McChesney Martin, who became chairman in 1951. The Monetary Policy of the Federal Reserve explains in a straightforward way the emergence and nature of the modern, inflation-targeting central bank.
Monetary Policy, Trend Inflation and the Great Moderation
Author: Olivier CoibionPublisher:
ISBN:
Category : Deflation (Finance)
Languages : en
Pages : 39
Book Description
With positive trend inflation, the Taylor principle is not enough to guarantee a determinate equilibrium. We provide new theoretical results on restoring determinacy in New Keynesian models with positive trend inflation and combine these with new empirical findings on the Federal Reserve's reaction function before and after the Volcker disinflation to find that 1) while the Fed satisfied the Taylor principle in the pre-Volcker era, the US economy was still subject to self-fulfilling fluctuations in the 1970s, 2) while the Fed's response to inflation is not statistically different before and after the Volcker disinflation, the US economy nonetheless moved from indeterminacy to determinacy in this time period, and 3) the change from indeterminacy to determinacy is due to the simultaneous decrease in the response to the output gap, increases in the response to inflation and output growth and the decline in steady-state inflation from the Volcker disinflation.
Essays on Trend Inflation, Nominal Rigidity, and Optimal Monetary Policy
Author: Xuanyang ZhangInflation Expectations
Author: Peter J. N. SinclairPublisher: Routledge
ISBN: 1135179778
Category : Business & Economics
Languages : en
Pages : 402
Book Description
Inflation is regarded by the many as a menace that damages business and can only make life worse for households. Keeping it low depends critically on ensuring that firms and workers expect it to be low. So expectations of inflation are a key influence on national economic welfare. This collection pulls together a galaxy of world experts (including Roy Batchelor, Richard Curtin and Staffan Linden) on inflation expectations to debate different aspects of the issues involved. The main focus of the volume is on likely inflation developments. A number of factors have led practitioners and academic observers of monetary policy to place increasing emphasis recently on inflation expectations. One is the spread of inflation targeting, invented in New Zealand over 15 years ago, but now encompassing many important economies including Brazil, Canada, Israel and Great Britain. Even more significantly, the European Central Bank, the Bank of Japan and the United States Federal Bank are the leading members of another group of monetary institutions all considering or implementing moves in the same direction. A second is the large reduction in actual inflation that has been observed in most countries over the past decade or so. These considerations underscore the critical – and largely underrecognized - importance of inflation expectations. They emphasize the importance of the issues, and the great need for a volume that offers a clear, systematic treatment of them. This book, under the steely editorship of Peter Sinclair, should prove very important for policy makers and monetary economists alike.
Monetary Policy, Trend Inflation, and the Great Moderation: an Alternative Interpretation
Author: Yasuo HiroseMonetary Policy, Trend Inflation, and the Great Moderation
Author: Willem Van ZandweghePublisher:
ISBN:
Category :
Languages : en
Pages : 28
Book Description
What caused the U.S. economy's shift from the Great Inflation era to the Great Moderation era? A large literature shows that the shift was achieved by the change in monetary policy from a passive to an active response to inflation. However, Coibion and Gorodnichenko (2011) attribute the shift to a fall in trend inflation along with the policy change, based on a solely estimated Taylor rule and a calibrated staggered-price model. We estimate the Taylor rule and the staggered-price model jointly and demonstrate that the change in monetary policy responses to inflation and other variables suffices for explaining the shift.