Does better information about foreign shocks improve monetary policy?

Autor:	Misa Tanaka, Kang Yong Tan
Rok vydání:	2010
Předmět:	Macroeconomics Economics and Econometrics General equilibrium theory Labour supply Information sharing Monetary policy New Keynesian economics Dynamic stochastic general equilibrium Perfect information Economics Terms of trade Finance
Zdroj:	Journal of International Money and Finance. 29:1546-1561
ISSN:	0261-5606
DOI:	10.1016/j.jimonfin.2010.05.009
Popis:	This paper examines whether better information about foreign shocks leads to welfare-improving monetary policy using a stylised two-country New Keynesian general equilibrium model. We demonstrate that when terms of trade externality exist and national central banks have the incentives to shift terms of trade in their own favour, the equilibrium under imperfect information may be welfare superior relative to an equilibrium with perfect information. In addition, the welfare gains or losses from information sharing between central banks are found to be small for empirically plausible range of parameters for risk aversion and elasticity of labour supply.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::e7c300f06a7de11351bb8b40c4569015 https://doi.org/10.1016/j.jimonfin.2010.05.009 Zobrazit plný text záznamu Full Text from ScienceDirect