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Leaning Against the Wind : The Role of Different Assumptions About the Costs

Svensson, Lars E. O. - 2017

of a weaker economy with higher unemployment and lower inflation and possible benefits from a lower probability or … magnitude of a (financial) crisis. A first obvious cost is a weaker economy if no crisis occurs. A second cost—less obvious, but … higher—is a weaker economy if a crisis occurs. Taking the second cost into account, Svensson (2017) shows that for …

Persistent link: https://www.econbiz.de/10012948449

The Equilibrium Degree of Transparency and Control in Monetary Policy

Faust, Jon; Svensson, Lars E. O. - 2022

We examine a central bank's endogenous choice of degree of control and degree of transparency, under both commitment and discretion. Under commitment, we find that the deliberate choice of sloppy control is far less likely under a standard central-bank loss function than reported for a less...

Persistent link: https://www.econbiz.de/10014157375

How Should Monetary Policy Be Conducted in an Era of Price Stability?

Svensson, Lars E. O. - 2021

The paper discusses several issues related to how monetary policy should be conducted in an era of price stability. Low inflation (with base drift in the price level) and price-level stability (without such base drift) are compared, and a suitable loss function (corresponding to flexible...

Persistent link: https://www.econbiz.de/10013219290

Inflation Targeting as a Monetary Policy Rule

Svensson, Lars E. O. - 2021

The purpose of the paper is to survey and discuss inflation targeting in the context of monetary policy rules. The paper provides a general conceptual discussion of monetary policy rules, attempts to clarify the essential characteristics of inflation targeting, compares inflation targeting to...

Persistent link: https://www.econbiz.de/10013218714