The observed tightening of interest rates in the aftermath of the post-World War II oil price hikes led some to argue that U.S. monetary policy exacerbated the recessions induced by oil price shocks. This paper provides a critical evaluation of this claim. Within an estimated dynamic stochastic...

value exists and displays more severely in smaller samples.

This paper presents an algorithm to solve up to the second order of approximation rational expectations models with informational subperiods, and provides simple examples to demonstrate how the algorithm works. Copyright Springer Science+Business Media New York 2013

The observed tightening of interest rates in the aftermath of the post-World War II oil price hikes led some to argue that U.S. monetary policy exacerbated the recessions induced by oil price shocks. This paper provides a critical evaluation of this claim. Within an estimated dynamic stochastic...