Monetary Policy and Bubbles in a New Keynesian Model with Overlapping Generations

Jordi Galí
Authors registered in the RePEc Author Service: Jordi Galí

No 959, Working Papers from Barcelona School of Economics

Abstract: I analyze an extension of the New Keynesian model that features overlapping generations of finitely- lived agents and (stochastic) transitions to inactivity. In contrast with the standard model, the proposed framework allows for the existence of rational expectations equilibria with asset price bubbles. I study the conditions under which bubble-driven fluctuations may emerge and the type of monetary policy rules that may prevent them. I conclude by discussing some of the model's welfare implications.

Keywords: monetary policy rules; stabilization policies; asset price volatility; economic fluctuations (search for similar items in EconPapers)
JEL-codes: E44 E52 (search for similar items in EconPapers)
Date: 2017-03
New Economics Papers: this item is included in nep-cba, nep-mac and nep-mon
References: Add references at CitEc
Citations: View citations in EconPapers (8)

Downloads: (external link)
https://bw.bse.eu/wp-content/uploads/2017/03/959-file.pdf (application/pdf)

Related works:
Journal Article: Monetary Policy and Bubbles in a New Keynesian Model with Overlapping Generations (2021)
Working Paper: Monetary Policy and Bubbles in New Keynesian Model with Overlapping Generations (2020)
Working Paper: Monetary Policy and Bubbles in a New Keynesian Model with Overlapping Generations (2020)
Working Paper: Monetary policy and bubbles in a new Keynesian model with overlapping generations (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bge:wpaper:959

Access Statistics for this paper

More papers in Working Papers from Barcelona School of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Bruno Guallar ().