Similar Search Results

Fiscal Policy, Wealth Effects and Markups

Monacelli, Tommaso; Perotti, Roberto - C.E.P.R. Discussion Papers - 2008

challenge for a neoclassical model, which relies on the wealth effect on labor supply as the main channel of transmission of … unproductive government spending shocks. The goal of this paper is to explore further the role of the wealth effect in the …, in which preferences can be consistent with an arbitrarily small wealth effect on labor supply, and highlight that such …

Persistent link: https://www.econbiz.de/10005662286

Hyperbolic Discounting and Positive Optimal Inflation

Graham, Liam; Snower, Dennis J. - C.E.P.R. Discussion Papers - 2011

The Friedman rule states that steady-state welfare is maximized when there is deflation at the real rate of interest. Recent work by Khan et al. (2003) uses a richer model but still finds deflation optimal. In an otherwise standard new Keynesian model we show that, if households have hyperbolic...

Persistent link: https://www.econbiz.de/10009643503

A New Comparative Approach to Macroeconomic Modeling and Policy Analysis

Cwik, Tobias; Mueller, Gernot; Schmidt, Sebastian; … - C.E.P.R. Discussion Papers - 2012

In the aftermath of the global financial crisis, the state of macroeconomic modeling and the use of macroeconomic models in policy analysis has come under heavy criticism. Macroeconomists in academia and policy institutions have been blamed for relying too much on a particular class of...

Persistent link: https://www.econbiz.de/10011083870

A defence of the FOMC

Ellison, Martin; Sargent, Thomas J - C.E.P.R. Discussion Papers - 2009

We defend the forecasting performance of the FOMC from the recent criticism of Christina and David Romer. Our argument is that the FOMC forecasts a worst-case scenario that it uses to design decisions that will work well enough (are robust) despite possible misspecification of its model. Because...

Persistent link: https://www.econbiz.de/10008477186

U.S. Monetary Shocks and Global Stock Prices

Laeven, Luc; Tong, Hui - C.E.P.R. Discussion Papers - 2010

This paper studies how U.S. monetary policy affects global stock prices. We find that global stock prices respond strongly to changes in U.S. interest rate policy, with stock prices increasing (decreasing) following unexpected monetary loosening (tightening). This impact is more pronounced for...

Persistent link: https://www.econbiz.de/10008692313

Wealth Effects on Consumption: Microeconometric Estimates from a New Survey of Household Finances

Bover, Olympia - C.E.P.R. Discussion Papers - 2006

This paper presents estimates of wealth effects on consumer spending using the first wave of a new survey of household … availability of such information from a representative sample subject to stratification by wealth. Furthermore we believe we are … able to measure wealth effects due to precautionary motives only. This is confirmed by the estimated pattern of wealth …

Persistent link: https://www.econbiz.de/10005136617

Asset Prices, News Shocks and the Current Account

Fratzscher, Marcel; Straub, Roland - C.E.P.R. Discussion Papers - 2010

linked to the financial market depth and equity home bias of countries. Moreover, the channels via wealth effects and via the …

Persistent link: https://www.econbiz.de/10008680756

Parameter Instability, Model Uncertainty and the Choice of Monetary Policy

Favero, Carlo A.; Milani, Fabio - C.E.P.R. Discussion Papers - 2005

This paper starts from the observation that parameter instability and model uncertainty are relevant problems for the analysis of monetary policy in small macroeconomic models. We propose to deal with these two problems by implementing a novel ‘thick recursive modelling’ approach. At each...

Persistent link: https://www.econbiz.de/10005498117

Monetary Policy and the Financing of Firms

De Fiore, Fiorella; Teles, Pedro; Tristani, Oreste - C.E.P.R. Discussion Papers - 2009

How should monetary policy respond to changes in financial conditions? In this paper we consider a simple model where firms are subject to idyosincratic shocks which may force them to default on their debt. Firms' assets and liabilities are denominated in nominal terms and predetermined when...

Persistent link: https://www.econbiz.de/10004976783

Long-Term Debt Pricing and Monetary Policy Transmission under Imperfect Knowledge

Eusepi, Stefano; Giannoni, Marc; Preston, Bruce - C.E.P.R. Discussion Papers - 2012

Under rational expectations monetary policy is generally highly effective in stabilizing the economy. Aggregate demand management operates through the expectations hypothesis of the term structure --- anticipated movements in future short-term interest rates control current demand. This paper...

Persistent link: https://www.econbiz.de/10011083648