This note reconsiders a recent proposal by A. Shaikh to tame Harrodian instability (Metroeconomica 2009), where besides the utilization gap investment depends on the expected growth of demand. His stability result has, however, been criticized as not credible. The crucial point is that Shaikh's...

The design of optimal environmental policy inherits model uncertainty.We investigate the consequences in a simple linear model, where the aim of the policymaker is to stabilise the atmospheric content of carbon. We study how decisionmakers’ concerns about robustness alters policy using the...

This paper takes a new look at the long-run dynamics of inflation and unemployment in response to permanent changes in the growth rate of the money supply. We examine the Phillips curve from the perspective of what we call "frictional growth", i.e. the interaction between money growth and...