Monetary policy and bubbles in a new keynesian model with overlapping generations
I analyze an extension of the New Keynesian model that features overlapping generations of finitely lived agents and (stochastic) transitions to inactivity. In contrast with the standard model, the proposed framework allows for the existence of rational expectations equilibria with asset price bubbl...
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| Formato: | artículo |
| Estado: | Versión publicada |
| Fecha de publicación: | 2021 |
| País: | España |
| Recursos: | Universitat Pompeu Fabra |
| Repositorio: | Repositorio Digital de la UPF |
| OAI Identifier: | oai:repositori.upf.edu:10230/47037 |
| Acesso em linha: | http://hdl.handle.net/10230/47037 http://dx.doi.org/10.1257/mac.20180427 |
| Access Level: | acceso abierto |
| Palavra-chave: | Monetary policy rules Stabilization policies Asset price volatility Macroeconomics and International Economics |
| Resumo: | I analyze an extension of the New Keynesian model that features overlapping generations of finitely lived agents and (stochastic) transitions to inactivity. In contrast with the standard model, the proposed framework allows for the existence of rational expectations equilibria with asset price bubbles. I study the conditions under which bubble- driven fluctuations may emerge and the type of monetary policy rules that may prevent them. I conclude by discussing some of the model’s welfare implications. (JEL E12, E32, E44, E52, E63) |
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