We develop an endogenous measure of anchoring for short-run expected inflation in a New Keynesian model with full-information ...

Nominal interest rates have real effects. Residential mortgages and other real world debt contracts require a sequence of constant nominal payments. Combined with payment-to-income constraints, these ...

Central banks use macroeconomic models to help frame the issues that they face, to mold their ideas, and to guide them in their decisionmaking. While a wide range of models are available, economists ...

The Nobel Memorial Prize in Economic Science was awarded this morning to Finn E. Kydland, a professor of economics at Carnegie Mellon University’s Tepper School of Business and at the University of ...

Keynesian economics is a macroeconomic theory that advocates for active government intervention to manage economic cycles, particularly during recessions and depressions. Developed by British ...

At best, redistribution from workers to the unemployed reallocates demand rather than increasing its total. July was the final month of the historically disproportionate unemployment bonus of $600 per ...

The November mid-term elections were a citizen referendum for reductions in the size and scope of the federal government. But can federal spending and the budget deficit actually be reduced ...

Just how important is money? Few would deny that it plays a key role in the economy.­ During the Great Depression of the 1930s, existing economic theory was unable either to explain the causes of the ...