Strengthening the FOMC's Framework in View of the Effective Lower Bound and Some Considerations Related to Time-Inconsistent Strategies

Autor:	Fernando Duarte, Benjamin K. Johannsen, Leonardo Melosi, Taisuke Nakata
Rok vydání:	2020
Předmět:	Microeconomics media_common.quotation_subject Monetary policy Economics Theoretical models Dynamic inconsistency Forward guidance Recession Upper and lower bounds media_common
Zdroj:	Finance and Economics Discussion Series. 2020:1-42
ISSN:	1936-2854
DOI:	10.17016/feds.2020.067
Popis:	We analyze the framework for monetary policy in view of the effective lower bound (ELB). We find that the ELB is likely to bind in most future recessions and propose some ways that theoretical models imply that the framework could be strengthened. We also discuss ways that commitment strategies, which are not part of the framework, may improve economic outcomes. These policies can suffer from a time-inconsistency problem, which we analyze.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::56330c21d15785e490b65998df632145 https://doi.org/10.17016/feds.2020.067 Zobrazit plný text záznamu Plný text ve formátu PDF