Monetary Policy Regimes and Beliefs
David Andolfatto () and
Paul Gomme ()
International Economic Review, 2003, vol. 44, issue 1, 1-30
This article investigates the role of beliefs over monetary policy in propagating the effects of monetary policy shocks within the context of a dynamic, stochastic general equilibrium model. In our model, monetary policy periodically switches between low and high money growth regimes. When individuals are unable to observe the regime directly, they form inferences over regime-type based on historical money growth rates. For an empirically plausible money growth process, beliefs evolve slowly in the wake of a regime change. As a result, our model is able to capture some of the observed persistence of real and nominal variables following such a regime change. Copyright 2003 By The Economics Department Of The University Of Pennsylvania And Osaka University Institute Of Social And Economic Research Association
References: Add references at CitEc
Citations View citations in EconPapers (83) Track citations by RSS feed
Downloads: (external link)
http://openurl.ingenta.com/content?genre=article&i ... 98&volume=44&spage=1 (application/pdf)
Free access to full text is restricted to Ingenta subscribers.
Working Paper: Monetary Policy Regimes and Beliefs (2001)
Working Paper: Monetary policy regimes and beliefs (2001)
Working Paper: Monetary policy regimes and beliefs (1997)
Working Paper: Monetary Policy Regimes and Beliefs (1997)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: http://EconPapers.repec.org/RePEc:ier:iecrev:v:44:y:2003:i:1:p:1-30
Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0020-6598
Access Statistics for this article
International Economic Review is currently edited by Harold L. Cole
More articles in International Economic Review from Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association 160 McNeil Building, 3718 Locust Walk, Philadelphia, PA 19104-6297. Contact information at EDIRC.
Series data maintained by Wiley-Blackwell Digital Licensing ().