Monetary Stabilisation with Nominal Asymmetries
Bibliographic Data
| ID | 9716703 |
|---|---|
| Authors | Stephen Wright (0000-0001-9973-9697, Birkbeck, University of London), Stephen H Wright (0000-0002-0591-0017, Birkbeck, University of London, corresponding author) |
| Year | 2004 |
| Volume | 114 |
| Issue | 492 |
| Pages | 196-222 |
| Publication date | 2004-01-01 |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | The Economic Journal (JOURNAL) |
| Journal identifiers | ISSN: 0013-0133 • E-ISSN: 1468-0297 |
| Publisher | Oxford University Press (OUP) (PUBLISHER) |
| DOI | 10.1046/j.0013-0133.2003.00183.x |
| OpenAlex | W2047461357 |
| Language | EN |
| References cited | 24 |
Optimal monetary stabilisation in the standard New Keynesian framework usually assumes a policy loss function from outside the model. In this paper, in contrast, the objective arises directly from the model. Credit constraints and sticky nominal debt contracts imply that monetary stabilisation has asymmetric impacts depending on whether consumers are credit‐constrained. The policy problem is to maximise some weighting of the expected utility of the different types of consumer. Features of optimal stabilisation are derived that do not appear to be far out of line with empirical evidence for many countries but that clearly conflict with standard loss function results
Business cycle · Debt · Economics · Function (biology · Macroeconomics · Monetary economics · Monetary policy · New Keynesian economics · Weighting · Banking stability, regulation, efficiency · Economic Theory and Policy · Monetary Policy and Economic Impact
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The Science of Monetary Policy
Staggered prices in a utility-maximizing framework
Monetary policy rules in practice
Monetary Policy, Nominal Interest Rates, and Long–Horizon Inflation Uncertainty
Intertemporal Substitution in Consumption
The Role of Countercyclical Monetary Policy
Credit Cycles
Distinguished Lecture on Economics in Government
Recent Trends in the Size Distribution of Household Wealth
A Theory of the Consumption Function, With and Without Liquidity Constraints
Inside the Black Box
| Highly cited | No |
|---|