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We analyse optimal discretionary games between a benevolent central bank and a myopic government in a New Keynesian model. First, when lump-sum taxes are available and public debt is absent, we show that a Nash game results in too much government spending and excessively high interest rates,...
Persistent link: https://www.econbiz.de/10014401471
; this means that the central bank may prefer to focus its communication policies on the information it knows most about …
Persistent link: https://www.econbiz.de/10014401641
information (data collection and processing) and communication (relationships and distribution). Both follow historic trends …. We argue that in particular the rise of new communication channels can lead to the vertical and horizontal disintegration …
Persistent link: https://www.econbiz.de/10012300645
We offer a novel methodology for assessing the quality of inflation reports. In contrast to the existing literature, which mostly evaluates the formal quality of these reports, we evaluate their economic content by comparing inflation factors reported by the central banks with ex-post...
Persistent link: https://www.econbiz.de/10014411339
This paper assesses the quality of the CBC's communication policy by looking at the predictability and effectiveness of … for the three major communication channels of the CBC: the release of policy meetings' statements, minutes, and monetary … monetary policy surprises associated with meeting statements and the impact of the above communication channels on asset …
Persistent link: https://www.econbiz.de/10011878683
methodology for the empirical evaluation of consistency in central bank communication. We find that the three communication tools …
Persistent link: https://www.econbiz.de/10014401995
for higher quality goods. We test the proposed theory using a highly disaggregated Argentinean firm-level wine export …
Persistent link: https://www.econbiz.de/10014411197
Effective public investment requires governments to address the "recurrent cost problem" to ensure operations and maintenance (O&M) expenditures are sufficient to sustain the flow of productive public capital services to private factors of production. Building on the model of Buffie et al...
Persistent link: https://www.econbiz.de/10014411214
We create a network of bilateral correlations of changes in sovereign bond yields and individual bank equity price changes since 2000. We extract some stylized facts from this network of asset price correlations and document the clear differences in asset price correlations between safe havens...
Persistent link: https://www.econbiz.de/10014411222
We consider a moral hazard economy in banks and production to study how incentives for risk taking are affected by the quality of supervision. We show that low interest rates may generate excessive risk taking. Because of a pecuniary externality, the market equilibrium may not be optimal and...
Persistent link: https://www.econbiz.de/10014411326