Estimated New Keynesian models reconcile inertial inflation with Calvo pricing only by forcing firms to re-optimise prices once every two years or more, which micro price data contradict. Making …
This paper builds a general-equilibrium model in which a currency crisis is triggered by prospective government deficits and shows that governments finance the resulting fiscal costs mainly through …
This paper argues, using data from five large devaluation episodes (Argentina 2001, Brazil 1999, Korea 1997, Mexico 1994, Thailand 1997), that the large post-devaluation fall in the real exchange rate …
This chapter in the 1999 Handbook of Macroeconomics (Volume 1) by Lawrence Christiano, Martin Eichenbaum, and Charles Evans surveys and unifies the VAR-based literature on identifying monetary policy …
This 2005 Journal of Political Economy paper by Christiano, Eichenbaum, and Evans (CEE) builds and estimates a general-equilibrium model to answer a specific question: what combination of frictions …
Studies how governments finance the fiscal costs of "twin" currency-and-banking crises and shows that debt devaluation and implicit or explicit fiscal reform, not just money printing, can explain why …
Argues that the 1997 Asian currency crisis was driven by large prospective government deficits -- the anticipated future fiscal cost of bailing out failing banking systems -- rather than by the …
The government-spending multiplier can be much larger than one when the zero lower bound on the nominal interest rate binds, and the larger the fraction of the spending that occurs while the nominal …