Macro models of monetary policy typically involve forward looking behavior. Except in rare
circumstances, we have to apply some numerical method to find the optimal policy and the …

This paper is a selective survey of new or recent methods to extract information about market
expectations from asset prices for monetary policy purposes. Traditionally, interest rates and …

Central banks tend to move official interest rates in a sequence of relatively small steps in
the same direction, a practice known as interest-rate smoothing. This paper documents this …

This paper presents a critical review of 158 research articles to explore the relationship
between stock return and inflation from 1930 to 2018, which provides a broad literature …

Inflation, output and interest rate stabilization are all potential central bank objectives. We
explore whether monetary policy should respond to asset price fluctuations when they are …

Using monthly data in the 1980s and early 1990s, our results do not support the short-run
Fisher effect since short-term interest rates are associated with negligible changes in …

The Fisher hypothesis has been a much debated topic. Over the years the hypothesis
debated and the techniques used have changed. While the majority of early studies on the …

This study reconsiders the common unit root/co-integration approach to test for the Fisher
effect for the economies of the G7 countries. We first show that nominal interest and inflation …

Using annual data for a sample of developing countries, the time-series evidence indicates
the allocation of monetary policy shocks, both expansionary and contractionary, between …

Tests of the Fisher effect are plagued by high persistence in interest rates. Instead of
standard regression analysis and asymptotic results, methods relying on local-to-unity …