Monetary Policy

Fan Liang

This paper asks why small firms hold large quantities of liquid assets — cash and cash equivalents that earn low or negative real returns — even when external credit is available. The conventional …

Mitali Das · Gita Gopinath · Helene Hall · Taehoon Kim · Jeremy C. Stein

This paper investigates why non-U.S. central banks accumulate large holdings of dollar-denominated foreign exchange reserves, focusing on a previously under-emphasized motive: the currency mismatch of …

Katharina Bergant · Prachi Mishra · Raghuram Rajan · Freddy Pinzon-Puerto

This paper examines how unexpected changes in U.S. monetary policy transmit to cross-border merger and acquisition (M&A) activity globally, covering both the volume of deals and their quality as …

Julien Acalin · Laurence Ball

The fall in the US federal debt-held-by-the-public/GDP ratio from a postwar peak of 106% in fiscal year 1946 to a trough of 23% in 1974 is widely cited (Elmendorf-Mankiw, Krugman) as evidence that an …

Mikael Carlsson · Alex Clymo · Knut-Eric Joslin

Carlsson, Clymo, and Joslin use Swedish manufacturing firm-level microdata for 1998–2013 to separately identify and characterize the cyclical behavior of physical productivity (TFPQ) shocks and demand …

Robert P Lieli · Augusto Nieto-Barthaburu

This paper develops a strategic model of point forecast production in environments where the forecast itself influences the outcome being predicted — what the authors call "forecasting with feedback." …

S. Borağan Aruoba · Thomas Drechsel

To study how monetary policy affects the economy, macroeconomists must isolate "shocks" — changes in interest rates that are not systematic responses to economic conditions. The paper proposes a new …

William A. Branch

Branch (2022) asks whether subjective consumer inflation expectations causally raise the inflation rate — a question whose empirical answer has been elusive despite its central role in New Keynesian …

Yuriy Gorodnichenko · Ari Kutai · Rafi Melnick

Research question and motivation. How do firms form and update inflation expectations during a monetary-policy regime change and a transition from high/volatile inflation to a low, stable, …

Carlo Altavilla · Giacomo Carboni · Michele Lenza · Harald Uhlig

This paper asks whether uncertainty in the interbank market — distinct from general macroeconomic uncertainty — raises the cost of bank credit to firms, and whether bank-specific characteristics …

Isabel Cairó · Avi Lipton

This paper addresses two connected questions: why do Black workers face persistently higher and more volatile unemployment than white workers, and can the Federal Reserve's August 2020 shift from a …

Andrea Ferrero · Maurizio Michael Habib · Livio Stracca · Fabrizio Venditti

This paper investigates how institutional quality shapes (i) the domestic financial and macroeconomic impact of Global Financial Cycle (GFC) shocks on emerging market economies (EMEs) and (ii) the …

Jianjun Miao · Zhouxiang Shen · Dongling Su

This paper asks how bank holdings of long-term government securities interact with interest-rate-driven monetary tightening to amplify macroeconomic downturns and generate banking crises. The …

Christiaan van der Kwaak

When central banks pay interest on reserves — as the Federal Reserve has done since October 2008 and as is standard operating procedure today — does financing fiscal stimulus by permanently expanding …

Hassan Afrouzi · Marina Halac · Kenneth Rogoff · Pierre Yared

Post-pandemic inflation across advanced economies rose to levels not seen since the early 1980s, reviving interest in central bank credibility. The standard quantitative macro models used to interpret …

Davide Debortoli · Mario Forni · Luca Gambetti · Luca Sala

This paper measures how the inflation-unemployment tradeoff associated with monetary policy varies with both the sign of the monetary intervention (easing versus tightening) and the state of the …

Luca Gagliardone · Mark Gertler

Gagliardone and Gertler ask why the US inflation surge that began in mid-2021 was both sudden and persistent, and whether a simple structural model can account for it without targeting inflation in …

Minsu Chang · Frank Schorfheide

This paper asks how conventional and informational monetary policy shocks affect the cross-sectional distributions of labor earnings, consumption, and financial income in the United States. The …

Damien Capelle · Yang Liu

This paper analyzes the effectiveness of a tax on inflation policy (TIP)—a fiscal instrument that would require firms to pay a tax proportional to the increase in their prices—as a complement to …

Kee-Youn Kang · Zijian Wang

Research question and motivation: Digital payments generate vast, high-frequency, transaction-level data that several central banks (Bank of Canada, Swiss National Bank, Eurosystem members) already …

Matthew Klepacz

This paper asks whether increases in aggregate volatility reduce the effectiveness of monetary policy by making aggregate prices more flexible. The motivation is concrete: policymakers worry that …

Lukasz A. Drozd · Marcin Kolasa · Jaromir B. Nosal

This paper evaluates five microfounded pricing-to-market (PTM) mechanisms and one reduced-form aggregator in a two-country DSGE model with volatile exchange rates driven by financial shocks (following …

Sushant Acharya · Jess Benhabib

Research question and motivation: A central tenet of monetary policy is that aggressively raising nominal rates more than one-for-one with inflation (the Taylor principle) nips self-fulfilling …

Russell Cooper · Ozgen Ozturk

This paper investigates what drives the countercyclical dispersion of TFPR — total factor productivity measured in revenue terms — a pattern that is well documented empirically but poorly understood …

Eunkyung Lee

Research question and motivation. This paper asks how monetary policy transmits to corporate investment through bank credit, and specifically whether the relevant credit margin is the origination of …

Donggyu Lee

This paper asks whether the Federal Reserve's unconventional monetary policies (UMP) — specifically quantitative easing (QE) and forward guidance — exacerbated income and welfare inequality in the …

Michael W. L. Elsby · Axel Gottfries · Pawel Krolikowski · Gary Solon

This paper develops a tractable theoretical model of wage dynamics in long-term employment relationships, situated between two polar extremes in the existing literature: continual Nash renegotiation …

Drago Bergholt · Fabio Canova · Francesco Furlanetto · Nicolò Maffei-Faccioli · Pål Ulvedal

The paper addresses what drove the post-COVID inflation surge in the United States and internationally. Before answering the substantive question, the authors identify and diagnose a methodological …

Behzad Diba · Olivier Loisel

Since 2008 the US economy has gone through two zero-lower-bound (ZLB) episodes (Dec 2008–Dec 2015 and Mar 2020–Mar 2022). Standard New Keynesian (NK) and monetarist models struggle with three broad …

Peter Bednarek · Valeriya Dinger · Alison Schultz · Natalja von Westernhagen

Can banks effectively monitor their peers under asymmetric information? Effective peer monitoring matters for functioning interbank markets and, by implication, financial markets and the transmission …

Philippe Bacchetta · Elena Perazzi

As central banks worldwide explore retail central bank digital currency (CBDC), the macroeconomic consequences depend heavily on how CBDC interacts with bank deposits. Prior work spans a wide range of …

Chadwick Curtis · Julio Garín · Robert Lester

The paper asks whether population aging flattens the Phillips curve through a previously unexplored channel — age-related differences in the elasticity of substitution across product varieties. …

Luís A.V. Catão · Jan Ditzen · Daniel Marcel te Kaat

The paper asks how far global factors drive the foreign-borrowing component of advanced-economy banks' non-core funding, and whether exchange rate flexibility (and macroprudential policy) can insulate …

Gene Ambrocio

Macro-uncertainty is widely believed to depress activity, but existing measures are tied to financial markets, professional forecasters, or economic policy, while a key transmission channel runs …

Rafael Gerke · Sebastian Giesen · Daniel Kienzler

This paper revisits the "reversal puzzle" — the counterintuitive result, first documented by Carlstrom, Fuerst and Paustian (CFP, 2015), that in standard New Keynesian models the effect of forward …

Charles M. Kahn · David Marshall · Robert L. McDonald

This paper develops a theoretical model to explain why financial markets can suffer self-fulfilling liquidity crises and how a central bank acting as a "market-maker of last resort" (MMLR) can …

Álvaro Fernández-Gallardo · Iván Payá

There is now broad consensus that monetary authorities should hold a financial-stability mandate and that macroprudential policy should be part of it, yet evidence on the macroeconomic effectiveness …

Rodrigo Barbone Gonzalez · João Barata Ribeiro Blanco Barroso · Bernardus Ferdinandus Nazar Van Doornik

Reserve requirements (RRs) were largely abandoned as a monetary tool in advanced economies after inflation targeting, but emerging markets (EMs) — especially Brazil — kept using them countercyclically …

Hidehiko Matsumoto

Emerging economies have rapidly accumulated foreign-currency (mostly dollar) debt — the dollar share of 14 emerging economies' foreign debt rose from 75% in 2010 to 81% in 2018. Such debt is dangerous …

Richard Dennis · Oleg Kirsanov

Experimental and survey evidence robustly documents "present bias" — people are more impatient over the short run than the long run, producing preference reversals inconsistent with standard …

Matthias Gnewuch · Donghai Zhang

Research question and motivation. Investment is a sizable and the most volatile component of aggregate GDP, so understanding the investment channel of monetary policy matters for policymakers.

Michael Smolyansky · Gustavo Suarez

When the Federal Reserve unexpectedly tightens policy, do riskier assets fall relative to safer ones (the standard prediction), or do investors read tightening as a signal that fundamentals are …

Meltem Chadwick · Rennae Cherry · Jaqueson K. Galimberti

Inflation expectations measured from household surveys are central inputs to monetary policy, but roughly half of respondents to the RBNZ Household Inflation Expectations survey decline to answer the …

Thorsten Beck · Peter Bednarek · Daniel te Kaat · Natalja von Westernhagen

The paper asks how exchange rate movements affect the real economy and what role the banking system's foreign-asset exposure plays in transmitting exchange rate shocks. The motivation is concrete: …

Carlo Altavilla · Refet S. Gürkaynak · Rogier Quaedvlieg

This paper establishes basic facts about the external finance premium (EFP) faced by euro area firms borrowing from banks, and studies how monetary policy is transmitted to it. The EFP — the extra …

Justine Guillochon

Research question and motivation: The paper asks whether and which television news topics shape French households' one-year-ahead macroeconomic expectations (inflation, unemployment, economic …

Thomas J. Sargent · Neil Wallace

This paper studies, within a simple "ad hoc" macroeconomic model not derived from individuals' and firms' optimizing behavior but built to resemble the macroeconometric models of the time, how the …

Olga Goldfayn-Frank · Pascal Kieren · Stefan Trautmann

Standard survey-based measurement of inflation expectations relies on density forecasts in which respondents assign probabilities to pre-specified inflation bins; this method has been found to induce …

Suman Basu · Emine Boz · Gita Gopinath · Francisco Roch · Filiz Unsal

Prepared as background for the IMF's Integrated Policy Framework, this paper builds a three-period small open economy in which monetary policy, capital inflow controls, sterilized foreign exchange …

James Tobin

This 1969 paper by James Tobin, published in the inaugural issue of the Journal of Money, Credit and Banking, sets out a general-equilibrium framework for monetary analysis built around the capital …

Dominik Boddin · Daniel Marcel te Kaat · Chang Ma · Alessandro Rebucci

This paper identifies and quantifies a housing portfolio channel of quantitative easing (QE) transmission that operates through household portfolio rebalancing toward second homes (as opposed to the …

Marco Bassetto · David S Miller

Why do sudden inflations and currency crises occur, while symmetric sudden deflations never do? The paper asks whether treating nominal government bonds as analogous to ordinary corporate bonds — with …

Luca Benati

Building on the finding that the velocity of M1 is, to a close approximation, the permanent component of short-term nominal interest rates, this paper proposes estimating the natural rate of interest …

Pierre-Olivier Gourinchas · Walker Ray · Dimitri Vayanos

The paper develops a two-country preferred-habitat model in which currency and bond markets are populated by different investor clienteles — currency traders with price-elastic demand for foreign …

Tobias Adrian · Christopher Erceg · Marcin Kolasa · Jesper Lindé · Pawel Zabczyk

A microfounded two-country New Keynesian model, calibrated separately to a representative emerging market and a representative advanced economy, in which limited FX-market risk-bearing capacity and an …

Tobias Adrian · Christopher Erceg · Jesper Lindé · Pawel Zabczyk · Jianping Zhou

An empirically-oriented New Keynesian small open economy model, of the kind central banks use, built to quantify when foreign exchange intervention and capital flow management tools improve monetary …

Joel P. Flynn · George Nikolakoudis · Karthik A. Sastry

Modern macroeconomic models of aggregate supply universally restrict firms to price-setting — committing to a price and supplying whatever quantity the market demands. Flynn, Nikolakoudis, and Sastry …

Ricardo Lagos · Randall Wright

This 2005 *Journal of Political Economy* paper by Ricardo Lagos and Randall Wright builds a monetary search model in which each period alternates between a decentralized market with anonymous …

Frank Smets · Raf Wouters

A sticky-price, sticky-wage dynamic general equilibrium model of the euro area, with habit formation, investment adjustment costs and variable capacity utilisation, is estimated by Bayesian methods on …

Elhanan Helpman

This 1981 Journal of Political Economy paper by Elhanan Helpman compares three exchange-rate regimes -- a float, a one-sided peg, and a cooperative peg -- in a two-country, perfect-foresight model …

Luca Gagliardone · Mark Gertler · Simone Lenzu · Joris Tielens

This paper addresses a fundamental puzzle in macroeconomics: why do estimates of the New Keynesian Phillips curve (NKPC) slope differ sharply depending on whether real marginal cost or the output gap …

Felipe Del Canto · John Grigsby · Eric Qian · Conor Walsh

The paper asks whether inflationary shocks are regressive, and demonstrates that the answer depends critically on the source of the shock. A single aggregate inflation statistic conceals radically …

Cooper Howes · Gregory Weitzner

Banks produce private information about borrowers that is inherently unobservable to outside researchers. Howes and Weitzner ask whether the quality of this private information is countercyclical — …

Elliot Anenberg · Tess Scharlemann · Eileen van Straelen

Does monetary policy stimulate household borrowing and consumption by enabling cash-out mortgage refinancing ("the cash-out refinance channel"), or does it primarily induce substitution across …

Kenneth Rogoff

This 1985 Journal of International Economics paper by Kenneth Rogoff shows that increased cooperation between central banks does not automatically raise welfare, because cooperation can exacerbate …

Francesco Lippi · Elia Moracci

Lippi and Moracci (2026) ask how euro area households choose between cash and card payments, and whether existing theoretical models can explain observed behavior. They draw on ECB payment diary …

Michael Ehrmann · Phillipp Gnan · Kilian Rieder

This paper investigates the economics of monetary policy leaks — anonymous disclosures of confidential information by insiders to the media — focusing on three central questions: (1) Are leaks random …

Benjamín García · Arsenios Skaperdas

This paper constructs a new measure of political pressure on the Federal Reserve from textual analysis of Fed Chairs' testimonies at Humphrey-Hawkins congressional hearings, and documents that the use …

Manuel Amador · Christopher Phelan

How does noise in the mapping from central bank actions to realized inflation affect the existence and character of reputational equilibria in monetary policy? Specifically, can a central bank that …

Francesco Giovanardi · Matthias Kaldorf

This paper asks two related questions about the intersection of climate policy and bank capital regulation. First, can differentiated bank capital requirements — imposing higher equity charges on …

Ippei Fujiwara · Kiminori Matsuyama

Fujiwara and Matsuyama ask whether the well-documented flattening of the New Keynesian Phillips curve (NKPC) and the concurrent rise in market concentration and markup rates are causally linked or …

Fernando Alvarez · Katarína Borovičková · Robert Shimer

This paper asks two related questions. First, can one develop a robust, distribution-free estimator for the discrete-time mixed proportional hazard (MPH) model of duration with unobserved …

Emil Holst Partsch · Ivan Petrella · Emiliano Santoro

Consumer durables account for a disproportionately large share of household expenditure fluctuations despite their small share of total private consumption. Two stylized facts motivate the paper: (1) …

Jonathan Payne · Bálint Szőke · George Hall · Thomas J Sargent

This paper constructs a new dataset of US federal bond prices and uses it to estimate the full term structure of yields on gold-denominated US federal debt from 1791 to 1933 — the entire gold standard …

Julien Bengui · Louphou Coulibaly

Bengui and Coulibaly ask whether the pattern of capital flows observed during the 2021–2023 global monetary tightening cycle — whereby capital flowed from low-inflation to high-inflation countries — …

Anastasiia Antonova · Gernot J. Müller

This paper asks how governments should optimally adjust sector-specific taxes in response to sectoral shocks when monetary policy cannot be tailored to individual sectors. The authors work within a …

Michael McLeay · Silvana Tenreyro

An emerging view in international macroeconomics contends that dollar invoicing of exports renders monetary policy ineffective for non-U.S. countries: because export prices are allegedly sticky in …

José Luis Montiel Olea · Mikkel Plagborg-Møller · Eric Qian · Christian Wolf

This paper provides formal theoretical results on the relative robustness of local projection (LP) and vector autoregression (VAR) confidence intervals for impulse response inference when the data …

Jonathon Hazell · Bledi Taska

Hazell and Taska use wages posted on online job vacancies — matched to job titles and establishment identifiers from Burning Glass Technologies — to measure the wage for new hires at the job level …

Giacomo Lanzani

This paper asks how an agent who fears that none of their probabilistic models is the correct description of the data-generating process (DGP) should update that fear as evidence accumulates, and what …

Cynthia L Doniger

This paper asks how the cyclical sensitivity of wages varies with workers' educational attainment, what mechanisms drive the differences, and what the welfare consequences are of ignoring this …

Brent Bundick · Isabel Cairó · Nicolas Petrosky-Nadeau

This paper investigates whether and how assumptions about household and firm expectations alter the macroeconomic implications of asymmetries commonly embedded in macroeconomic models. Specifically, …

Maurice Obstfeld · Kenneth Rogoff

This 1995 Journal of Political Economy paper by Maurice Obstfeld and Kenneth Rogoff builds the foundational "Redux" two-country dynamic general-equilibrium model that bridges the intertemporal …

Ming Zeng · Guihai Zhao

What drives the joint historical dynamics of the term structure of equity yields and nominal bond yields — and can a single unified equilibrium model explain the procyclical equity yield slope, the …

Jordan Roulleau-Pasdeloup

The paper asks whether an explicit, global, closed-form solution exists for the consumption function in the standard income fluctuation problem with a borrowing constraint and constant income, a …

Renato Faccini · Seungcheol Lee · Ralph Luetticke · Morten O. Ravn · Tobias Renkin

How do consumer credit spreads — the gap between household borrowing rates and deposit rates — affect aggregate business cycle dynamics and the distribution of consumption across the wealth …

Kirstin Hubrich · Yves S. Schüler · Daniel Waggoner

This paper investigates the role of leverage of financial institutions in amplifying the transmission of financial shocks to the macroeconomy, with particular attention to whether that amplification …

Philippe Bacchetta · Kenza Benhima · Brendan Berthold

Most recent work on optimal foreign-exchange intervention prices the opportunity cost of reserves off either deviations from uncovered interest parity or deviations from covered interest parity, and …

Jeffrey C. Fuhrer

Standard optimising consumption models make spending jump on impact when a shock hits, which the data flatly contradict; replacing time-separable utility with habit formation gives consumers a motive …

James H. Stock · Mark W. Watson

This 2002 NBER Macroeconomics Annual paper by James Stock and Mark Watson documents and investigates the "Great Moderation": the standard deviation of annual U.S. real GDP growth fell from 2.7% over …

Carlos Arteta · Steven Kamin · Franz U. Ruch

This paper examines how the effects of rising U.S. interest rates on emerging market and developing economies (EMDEs) depend on the underlying source of the interest rate increase. Specifically, it …

Jeffery D. Amato · Thomas Laubach

Adding habit formation in consumption to an optimising sticky-price model changes both the IS curve and the Phillips curve, makes the variance of output itself -- not only the output gap -- …

Jonas E Arias · Juan F Rubio-Ramírez · Minchul Shin · Daniel F Waggoner

The paper asks how to conduct valid Bayesian inference in time-varying structural vector autoregressions (SVARs) identified with sign restrictions, a setting in which existing algorithms are shown to …

Paul R. Krugman

Krugman argues that Japan's stagnation in the 1990s, with short-term interest rates pinned near zero and conventional monetary expansion seemingly powerless, is a genuine instance of the classical …

Guillermo A. Calvo · Andrés Velasco

Calvo and Velasco study an economy where both money and government bonds provide liquidity services, and they show that this shared role implies bond-financed fiscal expansions can be neutral or …

Saleem Bahaj · Ricardo Reis

This paper asks how a currency achieves international status — moving from zero to positive cross-border use — and whether deliberate central bank policy can accelerate that transition. The authors …

Serdar Birinci · Fatih Karahan · Yusuf Mercan · Kurt See

The paper asks two related questions: (1) How much, and through which channels, do employer-to-employer (EE) worker transitions affect macroeconomic outcomes — particularly inflation? (2) What is the …

Ke-Li Xu

This paper develops a uniform asymptotic theory for local projection (LP) regression under general conditions, addressing a gap in the literature where existing results required restrictive …

Morten O. Ravn · Vincent Sterk

A HANK model that is tractable enough to solve on paper, built by grafting Diamond-Mortensen-Pissarides search frictions onto a New Keynesian economy and then imposing assumptions that make the wealth …

Eric Anderson · Sergio Rebelo · Arlene Wong

Anderson, Rebelo, and Wong study the behavior of markups in the retail sector across regions and over time, using a combination of firm-level Compustat data and product-level scanner data from two …

George J. Bratsiotis · Kasun D. Pathirage

This paper introduces a four-agent estimated New Keynesian DSGE model—comprising banked simple households, underbanked simple households, firm owners, and bank owners—to examine agent-specific and …

Luca Fornaro · Federica Romei

In a multicountry model with nominal wage rigidities, two sectors (tradable with convex supply, nontradable with flat supply), and free capital mobility, the paper studies optimal monetary policy …

Zhesheng Qiu · Yicheng Wang · Le Xu · Francesco Zanetti

This paper studies the design of monetary policy in a multi-sector small open economy with domestic input-output linkages and cross-border production networks, under nominal price rigidities in …

Michael B. Devereux · Charles Engel

This 2003 Review of Economic Studies paper by Michael Devereux and Charles Engel builds a welfare-based, two-country stochastic sticky-price model -- extending Obstfeld and Rogoff (1995, 1998) -- to …

Luis G. Hernández-Román

This paper employs a proxy structural VAR model to examine the effects of global supply chain (GSC) shocks on U.S. macroeconomic variables and the Federal Reserve's historical response, and evaluates …

Sebastian Schmidt

The paper builds a discrete-time DSGE model with Calvo sticky prices in which the public sector has two feedback rules that can hit corners, generating endogenous shifts between an "orthodox" regime …

Camelia Minoiu · Rebecca Zarutskie · Andrei Zlate

Minoiu, Zarutskie, and Zlate ask whether participation in the Main Street Lending Program (MSLP)—a Federal Reserve emergency facility launched in mid-2020 to channel credit to small and mid-sized …

Peter Andre · Ingar Haaland · Christopher Roth · Mirko Wiederholt · Johannes Wohlfart

This paper investigates two related empirical questions in the context of the historic surge in US inflation in late 2021 and 2022: (1) What narratives—causal stories—do people invoke to explain why …

Maurice Obstfeld · Kenneth Rogoff

This 2000 Journal of International Economics paper by Maurice Obstfeld and Kenneth Rogoff extends the "Redux" sticky-price approach to a genuinely stochastic setting with an exact closed-form solution …

David Romer

This 1993 Quarterly Journal of Economics paper by David Romer points out and empirically tests a previously unnoticed prediction of Kydland-Prescott-style models of monetary policy without …

Yuteng Cheng · Ryuichiro Izumi

This paper examines how the degree of user anonymity built into a central bank digital currency (CBDC) affects bank lending decisions and what this implies for the optimal design of CBDC anonymity. …

Richard Dennis · Tatiana Kirsanova

Dennis and Kirsanova ask whether shocks to labor-market matching efficiency and worker bargaining power pose a significant problem for monetary policy, and whether the inability to commit (discretion …

Peter Maxted · David Laibson · Benjamin Moll

Maxted, Laibson, and Moll study fiscal and monetary policy in a partial-equilibrium heterogeneous-agent model in which homeowners have present-biased time preferences (Instantaneous Gratification …

Yuliya Rychalovska · Sergey Slobodyan · Rafael Wouters

This paper asks whether Survey of Professional Forecasters (SPF) data can be efficiently integrated into medium-scale DSGE models, and whether models with imperfectly rational expectations based on …

Torsten Persson

This 1984 Journal of Monetary Economics paper by Torsten Persson (circulated as IIES Seminar Paper No. 237, February 1983) asks whether the "monetary approach to the balance of payments" (MABOP) …

Ojasvita Bahl · Chetan Ghate · Debdulal Mallick

Governments in emerging market and developing economies (EMDEs) routinely intervene in agricultural markets — procuring grain and redistributing it to poor households — in response to food price …

Henrique S. Basso · Omar Rachedi

Basso and Rachedi investigate how robot adoption influences inflation dynamics — specifically, whether the surge in automation during the 2000s and 2010s can explain the muted sensitivity of inflation …

Tom D. Holden

The paper proposes and analyzes real rate rules — monetary policy rules of the form i_t = r_t + φπ_t (φ > 1), where r_t is the current-period real interest rate observed via TIPS yields or inflation …

Jeffery D. Amato · Thomas Laubach

Letting a fraction of consumers and price setters replace optimisation with a backward-looking rule of thumb adds endogenous persistence to output and inflation, changes how shocks travel through a …

Frank Smets · Rafael Wouters

A New Neoclassical Synthesis model of the US economy with seven structural shocks and a full set of real and nominal frictions is estimated on seven quarterly series by Bayesian methods, and shown to …

François Le Grand · Alaïs Martin-Baillon · Xavier Ragot

Should monetary policy deviate from price stability to address redistributive concerns in an economy with heterogeneous agents? The paper jointly solves for optimal monetary and fiscal policy under …

James Bullard · Alex Grimaud · Isabelle Salle · Gauthier Vermandel

Why did the 2021–2023 US inflation surge end in a soft landing — disinflation without a major recession — while the Volcker disinflation of 1979–1987 required substantial output losses? And was the …

Masazumi Hattori · Tomohide Mineyama · Jouchi Nakajima

The paper addresses a fundamental limitation of the standard Taylor rule as a monetary policy stance gauge: the rule is defined solely for the overnight federal funds rate (FFR) and cannot assess …

George S. Tavlas

This paper sets Milton Friedman's 1953 essay "The Case for Flexible Exchange Rates" side by side with Harry Johnson's near-identically titled 1969 essay, argument by argument, and concludes that …

Jesper Böjeryd · Roine Vestman · Björn Tyrefors · Dany Kessel

This paper estimates a causal housing wealth effect on consumption using a quasi-natural experiment in Stockholm, Sweden. The identification exploits an unanticipated political decision — announced in …

Masao Fukui · Emi Nakamura · Jón Steinsson

How does an exchange rate depreciation causally affect macroeconomic outcomes? The paper asks whether depreciations are expansionary or contractionary, and through which mechanism. The core …

Karlye Dilts Stedman · Andrew Hanson

The paper asks why unconventional monetary policy (UMP) spillovers from the European Central Bank (ECB) to the U.S. Treasury yield curve vary so substantially over time, and whether the time-varying …

Sebastian Heise · Jeremy Pearce · Jacob P. Weber

Which measures of labor market tightness best predict nominal wage inflation, and do standard measures such as the unemployment rate and the vacancy-to-unemployment ratio capture the relevant slack? …