established in the literature.

Policymakers take into account the possibility of a regime switch and counteract the externalities generated by the alternative regimes. The resulting behavior of inflation and output differs, both qualitatively and quantitatively, from what obtained in regime switches models with simple policy...

The paper develops a theory that endogenizes the currency composition of international nominal bond portfolios in general equilibrium. It emphasizes the critical roles of government debt and of government policies, and thereby reconnects to the partial equilibrium portfolio balance literature of...