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Constrained Discretion and Central Bank Transparency
(Economic Research Initiatives at Duke (ERID), 2015-02-01)
We develop and estimate a general equilibrium model to quantitatively assess the effects and welfare implications of central bank transparency. Monetary policy can deviate from active inflation stabilization and agents conduct ...
Escaping the Great Recession
(Economic Research Initiatives at Duke (ERID), 2015-01-01)
High uncertainty is an inherent implication of the zero lower bound, while deflation is not because of inflationary pressure due to uncertainty about how debt will be stabilized. We show that policy uncertainty empirically ...