The principles that govern the financial markets and goods market are some what identical. Based on demand supply, constant exchanges takes place in both the markets. In a way which we view and understand goods market, the same approach is being used for understanding financial markets wherein...

In Canada, targeting the inflation rate was intended as a temporary measure on a journey to price-level stability, but became a well-established monetary policy regime in its own right. This paper analyses the role of the interaction of economic ideas with the experience generated by their...

In this paper, we consider a small open economy under the New Keynesian model with unemployment of Galí (2011a, b) to discuss the design of the monetary policy. Our findings can be summarized in three parts. First, even with the existence of unemployment, the optimal policy is to minimize...