Casting a wide net in this, their second edition, Froyen and Guender provide coverage of the model-based literature on optimal monetary policy in the presence of uncertainty, with both open- and closed-economy frameworks considered. The authors have grounded New Keynesian research of the 1990s and 2000s in the literature of the 1970s, which viewed optimal policy as primarily a question of the optimal use of information, and studies in the 1980s that gave primacy to time inconsistency problems. The Global Financial Crisis of 2007-09 led to the recognition that financial markets and...
Casting a wide net in this, their second edition, Froyen and Guender provide coverage of the model-based literature on optimal monetary policy in the ...