Household's preferences and monetary policy inertia

Alessandro Flamini () and Andrea Fracasso

Economics Letters, 2011, vol. 111, issue 1, 64-67

Abstract: Interest rates set by central banks puzzlingly move with a certain inertia. We show that household's preferences can be important determinants of the optimal interest rate inertia due to their impact on the efficiency of the monetary policy transmission mechanism.

Keywords: Optimal; monetary; policy; Interest; rate; smoothing; Household's; preferences (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (5)

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Related works:
Working Paper: Household’s Preferences and Monetary Policy Inertia (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:111:y:2011:i:1:p:64-67

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