This paper develops a general perturbation methodology for constructing high-order approximations to the solutions of Markov-switching DSGE models. We introduce an important and practical idea of partitioning the Markov-switching parameter space so that a steady state is well defined. With this...

Fiscal uncertainty arises in many forms. Expiring temporary stimulus measures, projections of rapid debt growth, and oscillating political concerns over general levels of taxation are examples that all contribute to fiscal uncertainty. Motivated by anecdotal evidence associated with the US...

This paper investigates how different monetary policy regime switching types impact macroeconomic dynamics. Policy switches that either affect the inflation target or the response to deviations of inflation from target leads to different determinacy regions and different output, interest rates,...