Fernández-Villaverde, Jesús; Guerrón-Quintana, Pablo; … - In: IMF Economic Review 62 (2014) 2, pp. 248-260
Supply-side policies can play a role in fighting a low aggregate demand that traps an economy at the zero lower bound (ZLB) of nominal interest rates. Reductions in mark-ups or future increases in productivity triggered by supply-side policies generate a wealth effect that pulls current...