Monetary Policy and the Information Content of Prices

Abstract

Rational expectations and cleared markets lead to the proposition that feedback monetary policy is irrelevant to real activity, as in the analyses of Sargent and Wallace. However, if agents are differentially informed and have access to a common price, then prospective monetary policy actions--future feedback to imperfectly known current circumstances--can alter real activity by changing the information content of prices.

Cite this work

No public copy is stored for this record, so only the metadata is cited.

Stored only when both papers are in the corpus — 119 citations exist upstream.

Papers that cite the same references — the relational fallback while embeddings are still backfilling.