Open Daily: 10am - 10pm | Alley door pickup 10am - 7pm 3038 Hennepin Ave Minneapolis, MN
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  • Open Daily: 10am - 10pm
    Alley-side Pickup: 10am - 7pm

    3038 Hennepin Ave Minneapolis, MN
    612-822-4611

Open Daily: 10am - 10pm | Alley-side Pickup: 10am - 7pm
3038 Hennepin Ave Minneapolis, MN
612-822-4611
Persistent Stochastic Shocks in a New Keynesian Model with Uncertainty

Persistent Stochastic Shocks in a New Keynesian Model with Uncertainty

Kranz, Tobias

Paperback

Series: Bestmasters

EconomicsInvesting & Finance

ISBN10: 3658156384
ISBN13: 9783658156381
Publisher: Springer Gabler
Published: Oct 6 2016
Pages: 72
Weight: 0.25
Height: 0.18 Width: 5.83 Depth: 8.27
Language: English
The book introduces the New Keynesian framework, historically through a literature overview and through a step-by-step derivation of a New Keynesian Phillips curve, an intertemporal IS curve, and a targeting rule for the central bank. This basic version is then expanded by introducing cost and demand shocks and uncertainty. The latter enters the model via second order Taylor approximation instead of linearization. Bringing all equations together results in an equilibrium condition which is simulated with a wide range of parameter values, including possible crisis scenarios. The author finds that accounting for uncertainty - regarding growth and inflation expectations - can lead to lower nominal interest rates set by the central bank.

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