More on the time consistency of monetary policy

We introduce costs of unexpected inflation in a general equilibrium monetary model by changing the timing of the constraints faced by consumers. We show that in this environment monetary policy is still time inconsistent, but the nature of the inconsistency is very different from the standard result...

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Detalles Bibliográficos
Autor principal: Nicolini, J.P.
Formato: JOUR
Materias:
E58
E61
Monetary policy
Time inconsistency
Acceso en línea:http://hdl.handle.net/20.500.12110/paper_03043932_v41_n2_p333_Nicolini
Aporte de:
Biblioteca Digital - Facultad de Ciencias Exactas y Naturales (UBA) de Universidad de Buenos Aires
id todo:paper_03043932_v41_n2_p333_Nicolini
record_format dspace
spelling todo:paper_03043932_v41_n2_p333_Nicolini2023-10-03T15:20:15Z More on the time consistency of monetary policy Nicolini, J.P. E58 E61 Monetary policy Time inconsistency We introduce costs of unexpected inflation in a general equilibrium monetary model by changing the timing of the constraints faced by consumers. We show that in this environment monetary policy is still time inconsistent, but the nature of the inconsistency is very different from the standard result found in the literature. In particular, we find that the government may find optimal to deviate by choosing inflation rates lower than expected. By making a brief review of the monetary literature, we argue that the model of this paper is more attractive than the ones proposed before to study the time consistency of optimal monetary policy. JOUR info:eu-repo/semantics/openAccess http://creativecommons.org/licenses/by/2.5/ar http://hdl.handle.net/20.500.12110/paper_03043932_v41_n2_p333_Nicolini
institution Universidad de Buenos Aires
institution_str I-28
repository_str R-134
collection Biblioteca Digital - Facultad de Ciencias Exactas y Naturales (UBA)
topic E58
E61
Monetary policy
Time inconsistency
spellingShingle E58
E61
Monetary policy
Time inconsistency
Nicolini, J.P.
More on the time consistency of monetary policy
topic_facet E58
E61
Monetary policy
Time inconsistency
description We introduce costs of unexpected inflation in a general equilibrium monetary model by changing the timing of the constraints faced by consumers. We show that in this environment monetary policy is still time inconsistent, but the nature of the inconsistency is very different from the standard result found in the literature. In particular, we find that the government may find optimal to deviate by choosing inflation rates lower than expected. By making a brief review of the monetary literature, we argue that the model of this paper is more attractive than the ones proposed before to study the time consistency of optimal monetary policy.
format JOUR
author Nicolini, J.P.
author_facet Nicolini, J.P.
author_sort Nicolini, J.P.
title More on the time consistency of monetary policy
title_short More on the time consistency of monetary policy
title_full More on the time consistency of monetary policy
title_fullStr More on the time consistency of monetary policy
title_full_unstemmed More on the time consistency of monetary policy
title_sort more on the time consistency of monetary policy
url http://hdl.handle.net/20.500.12110/paper_03043932_v41_n2_p333_Nicolini
work_keys_str_mv AT nicolinijp moreonthetimeconsistencyofmonetarypolicy
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