Can the U.S. monetary policy fall (again) in an expectation trap?
By: Roc Armenter, Martin Bodenstein
Contributors: Bodenstein, Martin; Board of Governors of the Federal Reserve System (U.S.)
Series: International finance discussion papers -- no. 860; International finance discussion papers (Online) -- no. 860.
Publisher: Federal Reserve Board
Published: 2006
Place of publication: Washington, D.C
Language: eng
Format: [electronic resource] /
Description: "We provide a tractable model to study monetary policy under discretion.  We focus on Markov equilibria.  For all parametrizations with an equilibrium inflation rate around 2%, there is a second equilibrium with an inflation rate just above 10%.  Thus the model can simultaneously account for the low and high inflation episodes in the U.S.  We carefully characterize the set of Markov equilibria along the parameter space and find our results to be robust"--Federal Reserve Board web site.
Notes: Title from PDF file as viewed on 6/1/2006.

Includes bibliographical references.

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Mode of access: World Wide Web.