Determinacy, stock market dynamics and monetary policy inertia

Publikation: Bidrag til tidsskriftTidsskriftartikelForskningfagfællebedømt

We study equilibrium determinacy in a New-Keynesian model where the Central Bank responds to asset prices growth. Unlike Taylor-type rules that react to asset prices, the proposed alternative does not harm dynamic stability and in certain cases promotes determinacy by inducing interest-rate inertia.
OriginalsprogEngelsk
TidsskriftEconomics Letters
Vol/bind112
Udgave nummer1
Sider (fra-til)7-10
Antal sider4
ISSN0165-1765
DOI
StatusUdgivet - 2011

Bibliografisk note

JEL classification: C62, E52

    Forskningsområder

  • Asset prices, Determinacy, Monetary policy inertia

ID: 33780789