Event studies show that Fed unconventional announcements of forward guidance and large scale
asset purchases had large and desired effects on asset prices but do not tell us how long such
In 2005, bankruptcy laws were reformed significantly, making personal bankruptcy substantially
more costly to file than before. Shortly after, the US began to experience its most severe
recession in seventy years.
This article quantifies the stimulative effect of central bank forward guidance—the public
announcement of the intended path for monetary policy in the future—when the nominal
interest rate is stuck at its zero lower bound (ZLB).
Mortgage loans are a striking example of a persistent nominal rigidity. As a result, under
incomplete markets, monetary policy affects decisions through the cost of new mortgage
borrowing and the value of payments on outstanding debt.
The consensus in monetary policy circles that the Fed’s large-scale asset purchases, known as quantitative easing (QE), have significantly reduced long-term yields is due in part to event studies, which show that long-term yields decline on QE announcement days.
The nature of the business cycle appears to have changed. Prior to the 1990s, recoveries
from recessions were quick and steep; after the past three recessions, however, recoveries were
weak and prolonged.
We study the use of intermediated assets as media of exchange in a neo-
classical growth model. An intermediary is delegated control over productive
capital and finances itself by issuing claims against the revenue generated by
We use a general equilibrium finance model that features explicit government purchases
of private debts to shed light on some of the principal working mechanisms of the Federal
Reserve’s large-scale asset purchases (LSAP) and their macroeconomic effects.
This paper deals with a classic development question: how can the process of economic
development – transition from stagnation in a traditional technology to industrialization
and prosperity with a modern technology – be accelerated?
This paper uses several methods to study the interrelationship among Divisia monetary aggregates, prices, and income, allowing for nonstationary, nonlinearities, asymmetries, and time-varying relationships among the series.
Policymakers often use measures of tax incidence (generational accounts) as criteria for policy selection. We use a quantitative model of optimal intergenerational policy to evaluate the ability of the tax incidence metric to capture the identity of recipients and contributors and the magnitudes transferred.