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| Author: | Wright, S. |
| Title: | Monetary stabilisation with nominal asymmetries |
| Journal: | Economic Journal
2004 : JAN, VOL. 114:492, p. 196-222 |
| Index terms: | Monetary policy Stabilization |
| Language: | eng |
| Abstract: | Optimal monetary stabilisation in the standard New Keynesian framework usually assumes a policy loss function from outside the model. In contrast, the objective of this study arises directly from the model. Credit constraints and sticky nominal debt contracts imply that monetary stabilisation has asymmetric impacts depending on whether consumers are credit-constrained. The policy problem is to maximize some weighting of the expected utility of the different types of consumer. |
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