Jerome L. Stein

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Using a rational expectations model based on a Phillips curve with persistence in inflation, we derive optimal monetary policy rules under both commitment and discretion. We assume that the central bank targets the natural rate of output, so there is no incentive generating an average inflation bias. With commitment, inflation has less persistence but more(More)
Even advanced technological societies are vulnerable to natural disasters, such as the 2011 Tohoku earthquake and tsunami, and financial disasters, such as the 2008 collapse of the US housing and financial markets. Both resulted from unrecognized or underappreciated weaknesses in hazard assessment and mitigation policies. These policies relied on models(More)
We build a dynamic general equilibrium model based on the theory of the NATural Real EXchange rate, as developed by Jerome L. Stein and Polly R. Allen. The model succeeds in distinguishing a medium and a long term equilibrium value of the real Belgian franc. The medium term equilibrium is determined by the variables driving the investment and saving(More)
where V is the velocity function, shown in Figure 1~The Federal Reserve would like to select ranges for monetary growth over the coming year consistent with price stability) This is the policy of monetary targeting. The rationale for the policy of monetary targeting is the existence of a stable and reliable relationship between the rate of growth of(More)
The US financial crisis of 2008 involved the interaction of banks and security houses. The issues of “contagion” and debt crises became subjects of concern. The aim of this paper is to suggest dynamic nonlinear models of the interactions and optimization in financial markets, which explain the dynamics of contagion and the vulnerability of the financial(More)