Kurz, Mordecai; Jin, Hehui; Motolese, Maurizio - Center for Financial Studies - 2003
We show diverse beliefs is an important propagation mechanism of fluctuations, money non neutrality and efficacy of … structure of market beliefs about future discretionary decisions. We study two rationalizable beliefs. In one case, market … beliefs weaken the effect of policy and in the second, beliefs bolster policy outcomes and discretion could be a desirable …