Escapist policy rules

We study a simple, microfounded macroeconomic system in which the monetary authority employs a Taylor-type policy rule. We analyze situations in which the self-confirming equilibrium is unique and learnable according to Bullard and Mitra (2002). We explore the prospects for the use of 'large deviation' theory in this context, as employed by Sargent (1999) and Cho, Williams, and Sargent (2002). We show that our system can sometimes depart from the self-confirming equilibrium towards a non-equilibrium outcome characterized by persistently low nominal interest rates and persistently low inflation. Thus we generate events that have some of the properties of "liquidity traps" observed in the data, even though the policymaker remains committed to a Taylor-type policy rule which otherwise has desirable stabilization properties

Escapist Policy Rules

We study a simple, microfounded macroeconomic system in which the monetary authority employs a Taylor-type policy rule. We analyze situations in which the self-confirming equilibrium is unique and learnable according to Bullard and Mitra (2002). We explore the prospects for the use of ‘large deviation’ theory in this context, as employed by Sargent (1999) and Cho, Williams, and Sargent (2002). We show that our system can sometimes depart from the self-confirming equilibrium towards a non-equilibrium outcome characterized by persistently low nominal interest rates and persistently low inflation. Thus we generate events that have some of the properties of “liquidity traps” observed in the data, even though the policymaker remains committed to a Taylor-type policy rule which otherwise has desirable stabilization properties.Learning, monetary policy rules, escape dynamics

Escapist policy rules

We study a simple, microfounded macroeconomic system in which the monetary authority employs a Taylor-type policy rule. We analyze situations in which the self-confirming equilibrium is unique and learnable according to Bullard and Mitra (2002). We explore the prospects for the use of ‘large deviation’ theory in this context, as employed by Sargent (1999) and Cho, Williams, and Sargent (2002). We show that our system can sometimes depart from the self-confirming equilibrium towards a non-equilibrium outcome characterized by persistently low nominal interest rates and persistently low in- flation. Thus we generate events that have some of the properties of “liquidity traps” observed in the data, even though the policymaker remains committed to a Taylor-type policy rule which otherwise has desirable stabilization properties.Monetary policy ; Inflation (Finance) ; Interest rates

Atmospheric Circulation of Exoplanets

We survey the basic principles of atmospheric dynamics relevant to explaining existing and future observations of exoplanets, both gas giant and terrestrial. Given the paucity of data on exoplanet atmospheres, our approach is to emphasize fundamental principles and insights gained from Solar-System studies that are likely to be generalizable to exoplanets. We begin by presenting the hierarchy of basic equations used in atmospheric dynamics, including the Navier-Stokes, primitive, shallow-water, and two-dimensional nondivergent models. We then survey key concepts in atmospheric dynamics, including the importance of planetary rotation, the concept of balance, and scaling arguments to show how turbulent interactions generally produce large-scale east-west banding on rotating planets. We next turn to issues specific to giant planets, including their expected interior and atmospheric thermal structures, the implications for their wind patterns, and mechanisms to pump their east-west jets. Hot Jupiter atmospheric dynamics are given particular attention, as these close-in planets have been the subject of most of the concrete developments in the study of exoplanetary atmospheres. We then turn to the basic elements of circulation on terrestrial planets as inferred from Solar-System studies, including Hadley cells, jet streams, processes that govern the large-scale horizontal temperature contrasts, and climate, and we discuss how these insights may apply to terrestrial exoplanets. Although exoplanets surely possess a greater diversity of circulation regimes than seen on the planets in our Solar System, our guiding philosophy is that the multi-decade study of Solar-System planets reviewed here provides a foundation upon which our understanding of more exotic exoplanetary meteorology must build.Comment: In EXOPLANETS, edited by S. Seager, to be published in the Spring of 2010 in the Space Science Series of the University of Arizona Press (Tucson, AZ) (refereed; accepted for publication