Waller and Walsh (1996) argue that the optimal length of the central banker can exceed one period when the central bank is conservative enough. However, the optimal conservativeness is unlikely to be exogenous. In this note we show how the optimal conservativeness and the optimal term length are...

Empirical foundations for the view that high central government deficits and inflation impair growth are examined using annual data for 115 countries over the period 1960-1995. Taking into account country heterogeneity and time-specific symmetric shocks, we estimate intra-country effects of past...

We study the Becker and Lewis (1973) quantity-quality model of children adding an explicit child care time constraint for parents. They can purchase day care or take care of the children themselves. Our results are: (i) If there is a combination of purchased and own care, the effect of income on...

The implementation of explicit quantitative inflation targets elucidates the assessment of credibility of future monetary policy. Here the explicit inflation target is time-varying and stochastic with asymmetric information. It is shown that central bank independence promotes lower inflation but...

It has been widely accepted that politically induced variance can be generated when the wage contract is written before an election. In this paper, we show that inflation contracts and inflation targets can eliminate both the inflation bias and politically induced variance, if electoral...

The paper presents a theoretical analysis of the macroeconomic effects of active labour market programmes in a dual labour-market framework. The paper uses the Shapiro-Stiglitz efficiency-wage model. Active labour market programmes train unskilled labour and transfer them from a...