scholarly journals Robustly optimal monetary policy in a new Keynesian model with housing

2021 ◽  
Vol 198 ◽  
pp. 105352
Author(s):  
Klaus Adam ◽  
Michael Woodford
Keyword(s):  
Monetary Policy ◽  
New Keynesian ◽  
New Keynesian Model ◽  
Optimal Monetary Policy ◽  
Keynesian Model

scholarly journals Dynamic Debt Deleveraging and Optimal Monetary Policy

2020 ◽  
Vol 12 (2) ◽  
pp. 310-350 ◽  
Author(s):  
Pierpaolo Benigno ◽  
Gauti B. Eggertsson ◽  
Federica Romei
Keyword(s):  
Monetary Policy ◽  
Lower Bound ◽  
New Keynesian ◽  
New Keynesian Model ◽  
Optimal Monetary Policy ◽  
Natural Rate ◽  
Keynesian Model ◽  
Natural Rate Of Interest ◽  
Standard Framework

This paper proposes a postcrisis New Keynesian model that incorporates agent heterogeneity in borrowing and lending with a minimum set of assumptions. Unlike the standard framework, this model makes the natural rate of interest endogenous and dependent on macroeconomic policy. The main application is to study optimal monetary policy at the zero lower bound (ZLB). Such policy succeeds in raising the natural rate of interest by creating an environment that speeds up deleveraging and thus endogenously shortens the crisis and the duration of binding ZLB. Inflation should be front-loaded and should overshoot its long-term target during the ZLB episode. (JEL E12, E31, E32, E43, E52)

scholarly journals Labor Markets and Monetary Policy: A New Keynesian Model with Unemployment

2010 ◽  
Vol 2 (2) ◽  
pp. 1-30 ◽  
Author(s):  
Olivier Blanchard ◽  
Jordi Galí
Keyword(s):  
Monetary Policy ◽  
Labor Market ◽  
Labor Markets ◽  
New Keynesian ◽  
Price Setting ◽  
Efficient Allocation ◽  
New Keynesian Model ◽  
Optimal Monetary Policy ◽  
Productivity Shocks ◽  
Keynesian Model

We construct a utility-based model of fluctuations with nominal rigidities and unemployment. We first show that under a standard utility specification, productivity shocks have no effect on unemployment in the constrained efficient allocation. That property is also shown to hold, despite labor market frictions, in the decentralized equilibrium under flexible prices and wages. Inefficient unemployment fluctuations arise when we introduce real-wage rigidities. As a result, in the presence of staggered price setting by firms, the central bank faces a trade-off between inflation and unemployment stabilization, which depends on labor market characteristics. We draw the implications for optimal monetary policy. (JEL E12, E24, E52)

scholarly journals Optimal monetary policy in a New Keynesian model with habits in consumption

2012 ◽  
Vol 15 (3) ◽  
pp. 416-435 ◽  
Author(s):  
Campbell Leith ◽  
Ioana Moldovan ◽  
Raffaele Rossi
Keyword(s):  
Monetary Policy ◽  
New Keynesian ◽  
New Keynesian Model ◽  
Optimal Monetary Policy ◽  
Keynesian Model
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