Journal ArticleDOI
Staggered prices in a utility-maximizing framework
TLDR
In this article, the authors developed a model of staggered prices along the lines of Phelps (1978) and Taylor (1979, 1980), but utilizing an analytically more tractable price-setting technology.About:
This article is published in Journal of Monetary Economics.The article was published on 1983-09-01. It has received 8580 citations till now. The article focuses on the topics: Nominal rigidity & Taylor rule.read more
Citations
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Interest-Rate Rules in an Estimated Sticky Price Model
TL;DR: In this paper, the authors evaluate alternative rules by which the Fed may set interest rates using the small model of the U.S. economy estimated in Rotemberg and Woodford (1997).
Journal ArticleDOI
The Taylor Rule and Optimal Monetary Policy
TL;DR: In this paper, the authors consider the Taylor rule in the context of a simple, but widely used, optimizing model of the monetary transmission mechanism, which allows one to reach clear conclusions about economic welfare.
Journal ArticleDOI
The Perils of Taylor Rules
TL;DR: It is argued that once the zero bound on nominal interest rates is taken into account, active interest-rate feedback rules can easily lead to unexpected consequences and the use of local techniques for monetary policy evaluation might lead to spurious policy recommendations.
Journal ArticleDOI
The advantage of tying one's hands: EMS discipline and Central Bank credibility
Francesco Giavazzi,Marco Pagano +1 more
TL;DR: In this article, it is argued that EMS membership brings potentially large credibility gains for policy-makers in inflation-prone countries, since not only it attaches an extra penalty to inflation (in terms of real appreciation), but makes the public aware that the policymaker is faced with such penalty, and thus helps to overcome the inefficiency stemming from the public's mistrust of the authorities.
Posted Content
Monetary policy in an estimated stochastic dynamic general equilibrium model of the euro area
Frank Smets,Raf Wouters +1 more
TL;DR: In this article, a stochastic dynamic general equilibrium (SDGE) model with sticky prices and wages for the euro area was developed and estimated using seven key macroeconomic variables: GDP, consumption, investment, prices, real wages, employment and the nominal interest rate.
References
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Book
The Theory of Matrices
TL;DR: In this article, the Routh-Hurwitz problem of singular pencils of matrices has been studied in the context of systems of linear differential equations with variable coefficients, and its applications to the analysis of complex matrices have been discussed.
Journal ArticleDOI
Aggregate Dynamics and Staggered Contracts
TL;DR: In this article, the authors show that staggered wage contracts as short as 1 year are capable of generating the type of unemployment persistence which has been observed during postwar business cycles in the United States.
Journal ArticleDOI
"Rational" Expectations, the Optimal Monetary Instrument, and the Optimal Money Supply Rule
Thomas J. Sargent,Neil Wallace +1 more
TL;DR: In this paper, alternative monetary policies are analyzed in an ad hoc macroeconomic model in which the public's expectations about prices are rational, and it turns out that the probility distribution of output is independent of the particular deterministic money supply rule in effect.
Book
Public Investment, the Rate of Return, and Optimal Fiscal Policy
Kenneth J. Arrow,Mordecai Kurz +1 more
TL;DR: In this paper, a theory of "controllability" is developed and injected into public economics and growth models to analyze optimal public expenditures in the context of modern growth theory, and a model of optimal growth with public capital is proposed.