The deep and prolonged recession triggered by the global financial crisis of 2007–2009 led to a large increase in the unemployment rate in most advanced economies. Ten years later, at the time of writing this paper, the ...

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 ...

The magnitude of the global financial crisis of 2007–8 and the recession that it triggered ledmany central banks to lower their policy rates down to values near zero, their theoretical lower bound.1 In the United ...

We address this question using an estimated New Keynesian DSGE model of the Euro Area with trend inflation, imperfect indexation, and a lower bound on the nominal interest rate. In this setup, a decrease in the steady-state ...

We estimate the response of stock prices to monetary policy shocks using a time-varying coefficients VAR. Our evidence points to protracted episodes in which stock prices end up increasing persistently in response to an ...

In August 2007, when the first signs emerged of what would come to be the most damaging global financial crisis since the Great Depression, the New Keynesian paradigm was dominant in macroeconomics. Ten years later, tons ...

We study the gains from increased wage flexibility using a small open economy model with staggered price and wage setting. Two results stand out: (i) the effectiveness of labor cost reductions as a means to stimulate ...