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Monetary policy and its informative value Author info | Abstract | Publisher info | Download info | Related research | Statistics Romain Baeriswyl
Camille Cornand
This paper analyzes the welfare effects of economic transparency in a model of monopolistic competition with imperfect common knowledge on the shocks affecting the economy where the central bank has no inflationary bias. Monetary policy entails a dual role, as an action that stabilizes the economy and as a public signal that partially reveals to firms the central bank’s assessment about the economy. Firms are unable to perfectly disentangle the central bank’s signals responsible for the instrument: the central bank optimally balances the action and information purposes of its instrument. We derive the optimal monetary policy and central bank’s disclosure.
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Article provided by Federal Reserve Bank of San Francisco in its journal Proceedings .
Volume (Year): (2007)
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Keywords: Monetary policy ; References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.:
Eijffinger, Sylvester C.W. & Geraats, Petra M., 2006.
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[Downloadable!] (restricted)
Other versions:
Eijffinger, Sylvester C W & Geraats, Petra M, 2002.
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CEPR Discussion Papers
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Cambridge Working Papers in Economics
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[Downloadable!] Klaus Adam, 2003.
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Computing in Economics and Finance 2003
263, Society for Computational Economics.
[Downloadable!]
Other versions:
Klaus Adam, 2004.
"Optimal Monetary Policy with Imperfect Common Knowledge ,"
Econometric Society 2004 North American Winter Meetings
24, Econometric Society.
[Downloadable!] Klaus Adam, .
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DNB Staff Reports (discontinued)
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[Downloadable!] Klaus Adam, 2003.
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Working Paper Series
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CFS Working Paper Series
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CEPR Discussion Papers
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Journal of Monetary Economics ,
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[Downloadable!] (restricted) George-Marios Angeletos & Alessandro Pavan, 2006.
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NBER Working Papers
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Other versions: George-Marios Angeletos & Alessandro Pavan, 2007.
"Efficient Use of Information and Social Value of Information ,"
Econometrica ,
Econometric Society, vol. 75(4), pages 1103-1142, 07.
[Downloadable!] (restricted)
Baeriswyl, Romain & Cornand, Camille, 2007.
"Can Opacity of a Credible Central Bank Explain Excessive Inflation? ,"
Discussion Papers in Economics
1376, University of Munich, Department of Economics.
[Downloadable!]
Barro, Robert J & Gordon, David B, 1983.
"A Positive Theory of Monetary Policy in a Natural Rate Model ,"
Journal of Political Economy ,
University of Chicago Press, vol. 91(4), pages 589-610, August.
[Downloadable!] (restricted)
Other versions: Alan S. Blinder, 2000.
"Central-Bank Credibility: Why Do We Care? How Do We Build It? ,"
American Economic Review ,
American Economic Association, vol. 90(5), pages 1421-1431, December.
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Other versions: Alex Cukierman, 2002.
"Are contemporary central banks transparent about economic models and objectives and what difference does it make? ,"
Review ,
Federal Reserve Bank of St. Louis, issue Jul, pages 15-36.
[Downloadable!]
Other versions: Christian Hellwig, 2004.
"Heterogeneous Information and the Benefits of Public Information Disclosures (October 2005) ,"
UCLA Economics Online Papers
283, UCLA Department of Economics.
[Downloadable!]
Olivier Blanchard & John Simon, 2001.
"The Long and Large Decline in U.S. Output Volatility ,"
Brookings Papers on Economic Activity ,
Economic Studies Program, The Brookings Institution, vol. 32(2001-1), pages 135-174.
[Downloadable!]
Stephen Morris & Jeffery D. Amato & Hyun Song Shin, 2004.
"Communication and Monetary Policy ,"
Yale School of Management Working Papers
ysm345, Yale School of Management.
[Downloadable!]
Other versions:
Jeffery Amato & Stephen Morris & Hyun Song Shin, 2003.
"Communication and Monetary Policy ,"
Levine's Bibliography
506439000000000330, UCLA Department of Economics.
[Downloadable!] Jeffery D. Amato & Hyun Song Shin & Stephen Morris, 2003.
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BIS Working Papers
123, Bank for International Settlements.
[Downloadable!] Jeffrey D. Amado & Stephen Morris & Hyun Song Shin, 2003.
"Communication and Monetary Policy ,"
Cowles Foundation Discussion Papers
1405, Cowles Foundation, Yale University.
[Downloadable!] Jeffery D. Amato & Stephen Morris & Hyun Song Shin, 2002.
"Communication and Monetary Policy ,"
Oxford Review of Economic Policy ,
Oxford University Press, vol. 18(4), pages 495-503.
Baeriswyl, Romain, 2007.
"Central Bank's Action and Communication ,"
Discussion Papers in Economics
1381, University of Munich, Department of Economics.
[Downloadable!]
Christian Hellwig, 2002.
"Public Announcements, Adjustment Delays, and the Business Cycle (November 2002) ,"
UCLA Economics Online Papers
208, UCLA Department of Economics.
[Downloadable!]
Petra M. Geraats, 2002.
"Central Bank Transparency ,"
Economic Journal ,
Royal Economic Society, vol. 112(483), pages 532-565, November.
[Downloadable!] (restricted)
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references Cited by : (explanations , Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.)
George-Marios Angeletos & Alessandro Pavan, 2007.
"Policy with Dispersed Information ,"
NBER Working Papers
13590, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
Other versions: George-Marios Angeletos & Guido Lorenzoni & Alessandro Pavan, 2007.
"Wall Street and Silicon Valley: A Delicate Interaction ,"
NBER Working Papers
13475, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
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