Monetary Policy Response to Oil Price Shocks
نویسندگان
چکیده
منابع مشابه
Monetary Policy Response to Oil Price Shocks
How should monetary authorities react to an oil price shock? The New Keynesian literature has concluded that ensuring complete price stability is the optimal thing to do. In contrast, this paper argues that a meaningful trade-off between stabilizing inflation and the welfare relevant output gap arises in a distorted economy once one recognizes (i) that oil (energy) cannot be easily substituted ...
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In practice, central banks have been confronted with a trade-o¤ between stabilising ination and output when dealing with rising oil prices. This contrasts with the result in the standard New Keynesian model that ensuring complete price stability is the optimal thing to do, even when an oil shock leads to large output drops. To reconcile this apparent contradiction, this paper investigates how ...
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ژورنال
عنوان ژورنال: Journal of Money, Credit and Banking
سال: 2012
ISSN: 0022-2879
DOI: 10.1111/j.1538-4616.2011.00469.x