Monetary policy is under the cosh. Where did it all go wrong?
Simplifying assumptions- as there is “one” interest rate that mattets- must live or die or their ability to predict. And obviously the new k paradigm has suffered its second obvious failure- after 2008.
Really good. I am old enough to have missed in my formative years the new keynesian group think. We were thought to think of policy as affecting various “channels of transmission”, and besides knowing based on theory what the first derivatives should be, the rest was more descriptive.
Thank you for a great article !
Reminded me of this ineresing article by DeLong from a while back: https://www.aeaweb.org/articles?id=10.1257/jep.14.1.83