Monetary policy, doubts and asset prices

• 成果类型: Article
• 署名作者: Benigno, Pierpaolo; Paciello, Luigi
• 署名单位: Luiss Guido Carli University
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2014.02.004
• 发表日期: 2014
• 页码: 85-98
• 关键词: Optimal monetary policy; Near rationality; Distorted beliefs; asset prices; equity premium

摘要

Asset prices and the equity premium might reflect doubts and pessimism. Introducing these features in an otherwise standard New-Keynesian model changes optimal policy in a substantial way. There are three main results: (i) asset-price movements improve the inflation-output trade-off so that average output can rise without much inflation costs; (ii) a paternalistic policymaker - maximizing the expected utility of the consumers under the true probability distribution - chooses a more accommodating policy towards productivity shocks and inflates the equity premium; (iii) a benevolent policymaker maximizing the objective through which decisionmakers act in their ambiguous world follows a policy of price stability. (C) 2014 Elsevier B.V. All rights reserved.