00000nam 2200000zi 4500 9.870918 CaOODSP 20221107163242 m o d f cr ||||||||||| 190402t20192019oncd #ob f000 0 eng d CaOODSP eng rda CaOODSP eng fre FB3-5/2019-9E-PDF Hommes, Carsien Harm, author. Inflation targeting and liquidity traps under endogenous credibility / by Cars Hommes and Joep Lustenhouwer. Ottawa, Ontario, Canada : Bank of Canada = Banque du Canada, 2019. ©2019 1 online resource (ii, 35 pages) : graphs. text txt rdacontent computer c rdamedia online resource cr rdacarrier Bank of Canada staff working paper, 1701-9397 ; 2019-9 "February 2019." Includes bibliographical references. "Policy implications are derived for an inflation-targeting central bank, whose credibility is endogenous and depends on its past ability to achieve its targets. This is done in a New Keynesian framework with heterogeneous and boundedly rational expectations. We find that the region of allowed policy parameters is strictly larger than under rational expectations. However, when the zero lower bound on the nominal interest rate is accounted for, self-fulfilling deflationary spirals can occur, depending on the credibility of the central bank. Deflationary spirals can be prevented with a high inflation target and aggressive monetary easing"--Abstract, page ii. Includes abstract in French. gccst Monetary policy gccst Inflation gccst Interest rates Lustenhouwer, Joep‏, author. Bank of Canada. Staff working paper (Bank of Canada) 1701-9397 ; 2019-9. (CaOODSP)9.806221 PDF 1.21 MB https://publications.gc.ca/collections/collection_2019/banque-bank-canada/FB3-5-2019-9-eng.pdf