#2009-037A "The Identification of the Response of Interest Rates to Monetary Policy Actions Using Market-Based Measures of Monetary Policy Shocks"
by Daniel L. Thornton
August 2009

It is common practice to estimate the response of asset prices to monetary policy actions using market-based measures of monetary policy shocks, such as the federal funds futures rate. More...

#2009-036A "Problems in the Numerical Simulation of Models with Heterogeneous Agents and Economic Distortions"
by Adrian Peralta-Alva, and Manuel S. Santos
August 2009

Our work has been concerned with the numerical simulation of dynamic economies with heterogeneous agents and economic distortions. More...

FORTHCOMING: Journal of The European Economic Association (JEEA)

#2009-035A "Dynamic Taxation, Private Information and Money"
by Christopher J. Waller
August 2009

The objective of this paper is to study optimal fiscal and monetary policy in a dynamic Mirrlees model where the frictions giving rise to money as a medium of exchange are explicitly modeled. More...

#2009-034A "Random Matching and Money in the Neoclassical Growth Model: Some Analytical Results"
by Christopher J. Waller
August 2009

I use the monetary version of the neoclassical growth model developed by Aruoba, Waller and Wright (2008) to study the properties of the model when there is exogenous growth. More...

FORTHCOMING: Macroeconomic Dynamics

#2009-033B "Price Level Targeting and Stabilization Policy"
by Aleksander Berentsen, and Christopher J. Waller
August 2009
Revised October 2009

We construct a dynamic stochastic general equilibrium model to study optimal monetary stabilization policy. More...

#2009-032B "Optimal Stabilization Policy with Endogenous Firm Entry"
by Aleksander Berentsen, and Christopher J. Waller
August 2009

Monetary policy has significant but overlooked effects on entry and exit of firms. We study optimal monetary stabilization policy in a DSGE model with microfounded money demand and endogenous firm entry. More...

#2009-031A "Money and Capital: A Quantitative Analysis"
by S. Borağan Aruoba, Christopher J. Waller, and Randall Wright
August 2009

We study the effects of money (anticipated inflation) on capital formation. Previous papers on this adopt reduced-form approaches, putting money in the utility function or imposing cash in advance, but use otherwise frictionless models. More...

#2009-030A "Does Money Matter in Inflation Forecasting?"
by Jane M. Binner, Peter Tino, Jonathan Tepper, Richard G. Anderson, Barry Jones, and Graham Kendall
June 2009

This paper provides the most fully comprehensive evidence to date on whether or not monetary aggregates are valuable for forecasting US inflation in the early to mid 2000s. More...

#2009-029A "Speculative Bubbles and Financial Crisis"
by Pengfei Wang, and Yi Wen
June 2009

Why are asset prices so much more volatile and so often detached from their fundamentals? Why does the burst of financial bubbles depress the real economy? More...

#2009-028A "Capital Misallocation and Aggregate Factor Productivity"
by Costas Azariadis, and Leo Kaas
June 2009

We propose a sectoral–shift theory of aggregate factor productivity for a class of economies with AK technologies, limited loan enforcement, a constant production possibilities frontier, and finitely many sectors producing the same good. More...