Davide Debortoli

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Yes, it makes a lot of sense. Using the Smets and Wouters (2007) model of the U.S. economy, we …nd that the role of the output gap should be equal to or even more important than that of annualized in ‡ation when designing a simple loss function to represent household welfare. The high weight on the output gap is driven by several important characteristics(More)
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