The objectives of this paper are: first, to quantify the stabilization welfare gains from commitment; second, to … examine how commitment to an optimal rule can be sustained as an equilibrium and third, to find a simple interest rate rule … that closely approximates the optimal commitment one. We utilize an influential empirical micro-founded DSGE model, the …

straightforward recipe for mitigating the welfare costs and the systematic in ation shortfall associated with expectations …

policy rules and of the optimal unconstrained rule under commitment. The study reaches two main conclusions. First, inflation … the performance of the optimal rule under commitment. The optimal speed limit rule is also characterised by super …

This paper examines the welfare implications of a country joining a currency union as opposed to operating in a … to be welfare enhancing, the potential output gain must be the larger, the smaller the country, the larger the difference …

key factors favouring currency union formation, such as reduced transaction costs and enhanced credibility, which are … output-inflation tradeoffs and their business cycles are perfectly synchronised. Under supply shocks, welfare implications …