This chapter reviews the theory of optimal monetary stabilization policy in New Keynesian models, with particular emphasis on developments since the treatment of this topic in Woodford (2003). The primary emphasis of the chapter is on methods of analysis that are useful in this area, rather than...
international policy cooperationThis chapter studies optimal monetary stabilization policy in interdependent open economies, by proposing a unified analytical framework systematizing the existing literature. In the model, the combination of complete exchange-rate pass-through ('producer currency pricing') and...
This chapter studies optimal monetary stabilization policy in interdependent open economies, by proposing a unified analytical framework systematizing the existing literature. In the model, the combination of complete exchange-rate pass-through ('producer currency pricing') and frictionless asset markets en...
We approximate the model around the optimal steady state as the long-run policy target. Optimal monetary policy is characterized by stabilization of the nominal interest rate instead of inflation stabilization as the predominant principle.doi:10.1016/j.jedc.2007.10.009Matthias Paustian...
We construct a dynamic stochastic general equilibrium model to study optimal monetary stabilization policy. Prices are fully flexible and money is essential for trade. Our main result is that if the central bank pursues a long-run price path, thereby controlling inflation expectations, it can improve...
Teruyoshi Kobayashi."Optimal Monetary Policy and the Role of Hybrid Inflation-Price-Level Targets". Applied Economics . 2005Teruyoshi Kobayashi, 2005. " Optimal monetary policy and the role of hybrid inflation-price-level targets ," Applied Economics , Taylor & Francis Journals, vol. 37(18), ...
In this chapter, we derive optimal monetary policy when the central bank minimizes welfare losses arising from price dispersion among different goods. We show that welfare losses can be captured by a quadratic loss function as second order Taylor approxi
Moreover, our numerical simulations indicate that the optimal stabilization policy is "price stability". These findings represent a generalization to a state-dependent framework of the same results found for the simple Calvo model with exogenous timing of price adjustment. 关键词: optimal monetary ...
Section 7 presents the optimal simple policy rules, whether simple policy rules can attain a welfare level close to the planner׳s. In Section 8, I provide insights on actual policy making from the perspective of optimal monetary policy. Finally, Section 9 concludes. Access through your ...
We find that coefficients of optimal Taylor rules do not significantly change if financial market stabilization becomes part of the central banks objective function. Additionally, we show that rule-based, backward-looking monetary policy creates huge instabilities if expectations are boundedly rational. ...