1002682.pdf
The last decades have witnessed major progress in both monetary policy theory and practice, with broad academic consensus on the desirability of monetary policy rules and ongoing research on their exact specification. Typically, the analysis is carried out in a New Keynesian framework with nominal r...
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Peter Lang International Academic Publishers
2019
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oapen-20.500.12657-27330 |
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oapen-20.500.12657-273302022-04-26T11:15:52Z Interest-Rate Rules in a New Keynesian Framework with Investment Pavlova, Elena Framework Inflation-targeting Interest Investment Keynesian Monetary policy Pavlova Rate rational-expectations equilibrium Rules Taylor principle with bic Book Industry Communication::J Society & social sciences::JP Politics & government bic Book Industry Communication::K Economics, finance, business & management::KC Economics::KCA Economic theory & philosophy bic Book Industry Communication::K Economics, finance, business & management::KC Economics::KCB Macroeconomics::KCBM Monetary economics The last decades have witnessed major progress in both monetary policy theory and practice, with broad academic consensus on the desirability of monetary policy rules and ongoing research on their exact specification. Typically, the analysis is carried out in a New Keynesian framework with nominal rigidities and constant capital stock. The latter represents a constraint that this study seeks to overcome by introducing a model with investment and capital adjustment costs. The work assesses different interest-rate rule specifications with respect to the target variables included, based on two criteria: determinacy of rational-expectations equilibrium and convergence to steady state after a shock. The study concludes that rules with both an inflation and an output gap target ensure a unique rational-expectations equilibrium and a less distressful adjustment of the economy after the occurrence of shocks. 2019-01-10 23:55 2018-12-01 23:55:55 2019-01-10 03:00:32 2020-04-01T11:49:21Z 2020-04-01T11:49:21Z 2012-06-26 book 1002682 OCN: 817907315 9783653014440 http://library.oapen.org/handle/20.500.12657/27330 eng Schriften zur Wirtschaftstheorie und Wirtschaftspolitik application/pdf n/a 1002682.pdf Peter Lang International Academic Publishers 10.3726/978-3-653-01444-0 10.3726/978-3-653-01444-0 e927e604-2954-4bf6-826b-d5ecb47c6555 9783653014440 44 162 Bern open access |
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OAPEN |
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English |
| description |
The last decades have witnessed major progress in both monetary policy theory and practice, with broad academic consensus on the desirability of monetary policy rules and ongoing research on their exact specification. Typically, the analysis is carried out in a New Keynesian framework with nominal rigidities and constant capital stock. The latter represents a constraint that this study seeks to overcome by introducing a model with investment and capital adjustment costs. The work assesses different interest-rate rule specifications with respect to the target variables included, based on two criteria: determinacy of rational-expectations equilibrium and convergence to steady state after a shock. The study concludes that rules with both an inflation and an output gap target ensure a unique rational-expectations equilibrium and a less distressful adjustment of the economy after the occurrence of shocks. |
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1002682.pdf |
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| publisher |
Peter Lang International Academic Publishers |
| publishDate |
2019 |
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1771297605819564032 |
