The purpose of this study is to analyse the dynamic response of a set of euro area macroeconomic variables to monetary policy and technology shocks. We do so by conducting simulations on three different models of the euro area. The first modelling approach corresponds to structural VAR models (SVAR), the second approach uses the NiGEM multi-country model developed by the National Institute of E...

We study the question of existence and computation of time-consistent Markov policies of quasi-hyperbolic consumers under a stochastic transition technology in a general class of economies with multidimensional action spaces and uncountable state spaces. Under standard complementarity assumptions on preferences, as well as a mild geometric condition on a transition probabilities, we prove exist...

We develop a dynamic stochastic general equilibrium model to examine how monetary policy shocks affect income inequality and the equity premium. The features Ricardian non-Ricardian households shows that tightening causes an endogenous redistribution of from non-Ricardians Ricardians. Ricardians’ consumption comoves more strongly with asset returns, giving rise high premia. extend our several f...

Most dynamic stochastic general equilibrium models (DSGE) of the macroeconomy assume that labor is traded in a spot market. Two exceptions (Andolfatto [3], Merz [11]) combine the two-sided search model of Mortenson and Pissarides, [14], [13], [15] with a one-sector real business cycle model. These hybrid models are successful, in some dimensions, but they cannot account for observed volatility ...

One interpretation of the RBC research program is that it was meant to identify and incorporate into dynamic general equilibrium models those market imperfections which are most relevant for macroeconomic theory and policy. This paper reviews the methodological basis for this interpretation. It then discusses the empirical foundations for some of the many frictions that have found their way int...