Monetary policy and hysteresis in potential output
"We show that actively stabilizing economic activity plays a more prominent role in the conduct of monetary policy when potential output is subject to hysteresis. We augment a basic NewKeynesian model by hysteresis in potential output and contrast simulation outcomes of this extended model to t...
| Main Authors: | , |
|---|---|
| Institution: | ETUI-European Trade Union Institute |
| Format: | TEXT |
| Language: | English |
| Published: |
Düsseldorf
2013
IMK |
| Subjects: | |
| Online Access: | https://www.labourline.org/KENTIKA-19124366124919425489-Monetary-policy-and-hysteresis.htm |
| _version_ | 1771659900609363968 |
|---|---|
| author | Kienzler, Daniel Schmid, Kai Daniel |
| author_facet | Kienzler, Daniel Schmid, Kai Daniel |
| collection | Library items |
| description | "We show that actively stabilizing economic activity plays a more prominent role in the conduct of monetary policy when potential output is subject to hysteresis. We augment a basic NewKeynesian model by hysteresis in potential output and contrast simulation outcomes of this extended model to the standard model. We find that considering hysteresis allows for a more realistic propagation of macroeconomic shocks and persistent movements in output after monetary shocks. Our central policy implication of active output gap stabilization arises from stability analyses and welfare considerations." |
| format | TEXT |
| id | 19124366124919425489_e3c53b3708e744569b191af9a7299d3e |
| institution | ETUI-European Trade Union Institute |
| is_hierarchy_id | 19124366124919425489_e3c53b3708e744569b191af9a7299d3e |
| is_hierarchy_title | Monetary policy and hysteresis in potential output |
| language | English |
| physical | 34 p. Digital |
| publishDate | 2013 |
| publisher | Düsseldorf IMK |
| spellingShingle | Kienzler, Daniel Schmid, Kai Daniel economic policy macroeconomics monetary policy Monetary policy and hysteresis in potential output |
| thumbnail | https://www.labourline.org/Image_prev.jpg?Archive=100131392831 |
| title | Monetary policy and hysteresis in potential output |
| topic | economic policy macroeconomics monetary policy |
| url | https://www.labourline.org/KENTIKA-19124366124919425489-Monetary-policy-and-hysteresis.htm |