EFTA Document EFTA01388570

The limits of monetary policy PerwttAGE kv, Woch x. 1 Most recent discussions take a highly accessible paper by Noble laureate Paul Krugman as their starting point.5 The implication of his model is that there is indeed little that conventional monetary policy can do in the here and now. Printing more money to buy more bonds makes no difference. There is a way, however, that a central bank might still work its magic, namely through expectations. This means convincing households and firms t