serves as a substitute for commitment, enabling the central bank to achieve the efficient Ramsey equilibrium and avoid the … inefficient, time-inconsistent one-shot Nash equilibrium. We find that reputation is a poor substitute for commitment. We then … that these mechanisms have only small or transitory effects on welfare. Surprisingly, the real effects of supply shocks are …

modes of optimization, termed commitment and discretion. I estimate the model separately under each policy using maximum … commitment model but a more balanced concern relative to inflation and output stability in the discretionary model. …

multiple equilibria under pure discretion, and under full commitment there are two distinct determinate regimes. We study how … these properties change over the continuum of intermediate cases between commitment and discretion. We find that although …We study the existence and uniqueness properties of monetary policy with limited commitment in LQ RE models. We use a …

periodic reviews and adaptation. Replacing meeting-by-meeting discretion with a simple policy rule would eschew discretion in …

demonstrate that inflation-conservatism unambiguously leads to social welfare losses if the fiscal authority acts strategically …

periodic reviews and adaptation. Replacing meeting-by-meeting discretion with a simple policy rule would eschew discretion in …

, deficit and monetary rules, both in effectiveness at curbing public spending and welfare for private agents. However … shocks, the optimal ceiling on U.S. federal revenue is about 15% of GDP, which leads to welfare gains for private agents …