The purpose of this article is to characterize optimal interest rate rules in the framework of a dynamic stochastic general equilibrium model, and notably to scrutinize the “Taylor principle”, according to which the nominal interest rate should respond more than one for one to inflation....

[eng] Classical and Keynesian Features in Macroeconomic Models of Imperfect Competition For more than fifty years now the two main (and competing) paradigms in macroeconomics have been the classical and Keynesian ones. Since about twenty five years a new paradigm, imperfect competition...

[spa] El rol de la movilidad del trabajo en un modelo macroeconómico de subempleo con competencia imperfecta, negociaciones salariales y anticipaciones racionales, . por Jean-Pascal Bénassy.. . En este artículo se estudia el roi de la movilidad del trabajo. Se calculan soluciones explicitas...

It is often believed that governments should either abstain from leading activist policies, or if they lead such policies, that these policies should somehow be “stabilizing”, in the sense of reducing the volatilities of some endogenous variables. We construct a model with explicit...

This paper links the two fields of “development traps” and “brain drain”. We construct a model which integrates endogenous international migration into a simple growth model. As a result the dynamics of the economy can feature some underdevelopment traps: an economy starting with a low...

We construct in this paper a "benchmark" model of fluctuations with optimizing households and firms. The economy is a monetary one, with imperfect competition in goods and labor markets, as well as increasing returns to scale and specialization. This economy is subject to technological and...

Inflation is often given the central role in discussions of monetary policy. Is this emphasis warranted? We investigate this in a DSGE model and find: (1) One can implement the optimal interest rate policy using only employment as an instrument, (2) using inflation as an instrument would lead to...

This timely title gives a full account of the field, starting with the various general equilibrium traditions that ultimately led to this research area, and then describing the evolution of the models, with special emphasis on how they succeeded in representing features of dynamics that other...