In monetary unions, monetary policy is typically made by delegates of the member countries. This procedure raises the possibility of strategic delegation– that countries may choose the types of delegates to in‡uence outcomes in their favor. We show that without commitment in monetary policy, strategic delegation arises if and only if three conditions are met: shocks a¤ecting individual countrie...

The existing literature on robust monetary policy rules has largely focused on the case in which the policymaker has a single reference model while the true economy lies within a specified neighborhood of the reference model. In this paper, we show that such rules may perform very poorly in the more general case in which non-nested models represent competing perspectives about controversial iss...

REFERENCES 1. Chow EP, Gamagedara N, Bellhouse C, et al. HIV notification “Rate”: a more accurate and useful indicator to measure the HIV epidemic. J Acquir Immune Defic Syndr. 2015;70:e61–e62. 2. The White House Office of National AIDS Policy. National HIV/AIDS Strategy for the United States: Updated to 2020. Washington, D.C.; White House Office of National AIDS Policy: 2015. 3. CDC. HIV Surve...

This paper surveys the literature on the zero bound on the nominal interest rate. It addresses questions ranging from the conditions under which the zero bound on the nominal interest rate might occur to policy options to avoid or use to exit from such a situation. We discuss literature that examines historical and country evidence, and literature that uses models to generate evidence on this q...

This article uses a DSGE framework to evaluate the role of monetary policy in determining the likelihood of encountering the zero lower bound. We find that the probability of experiencing episodes of being at zero lower bound depends almost exclusively on the monetary policy rule. A policy rule, such as the one proposed by Taylor (1993) which is based on the dual mandate is highly likely to lea...

Objective—Atherosclerosis is a chronic inflammatory disease of the blood vessels. Toll-like receptor 4 (TLR4) is a transmembrane receptor that is involved in mediating inflammatory responses to bacterial endotoxin and other ligands. The aim of this study was to search for an association between a common functional polymorphism of TLR4— Asp299Gly—and acute coronary syndrome. Methods and Results—...

Optimal Price Indices for Targeting Inflation under Incomplete Markets In models with complete markets, targeting core inflation enables monetary policy to maximize welfare by replicating the flexible price equilibrium. In this paper, we develop a twosector two-good closed economy new Keynesian model to study the optimal choice of price index in markets with financial frictions. Financial frict...

We study optimal monetary and fiscal policy at the zero lower bound in a small open economy model with sticky prices and a flexible exchange rate. In such a liquidity trap situation, the economy suffers from a negative output gap, producer price deflation, and an appreciated real exchange rate (compared to its efficient level). The extent of these adverse effects and the duration of the liquidi...

This paper studies the role of asset-market completeness for the properties of optimal policy. A suitable framework for this purpose is the small open economy with complete international asset markets. For in this environment changes in policy represent country-specific risk diversifiable in world markets. Our main finding is that the fundamental public finance principle whereby when taxes on a...

In most developed economies, income tax rates and government debt levels are positive and sizable. In the US, effective income tax rates have been in the order of 20%, and outstanding public debt represents about 60% of GDP. The main question we pose in this paper is: can these numbers be accounted for as the outcome of a government’s welfare maximization program in a neoclassical economy? To a...