The science of monetary policy: A new Keynesian perspective

This paper reviews the recent literature on monetary policy rules. We exposit the monetary policy design problem within a simple baselinetheoretical framework. We then consider the implications of adding various real world complications. Among other things, we show that the optimal policy implicitly incorporates inflation targeting. Wealso characterize the gains from making credible commitments to fightinflation. In contrast to conventional wisdom, we show that gains from commitment may emerge even in the central bank is not trying toinadvisedly push output above its natural level. We also consider theimplications of frictions such as imperfect information.

Bank liquidity, interbank markets and monetary policy

A major lesson of the recent financial crisis is that the interbank lending marketis crucial for banks facing large uncertainty regarding their liquidity needs. Thispaper studies the efficiency of the interbank lending market in allocating funds. Weconsider two different types of liquidity shocks leading to different implications foroptimal policy by the central bank. We show that, when confronted with a distributional liquidity-shock crisis that causes a large disparity in the liquidity held amongbanks, the central bank should lower the interbank rate. This view implies that thetraditional tenet prescribing the separation between prudential regulation and monetary policy should be abandoned. In addition, we show that, during an aggregateliquidity crisis, central banks should manage the aggregate volume of liquidity. Twodifferent instruments, interest rates and liquidity injection, are therefore required tocope with the two different types of liquidity shocks. Finally, we show that failureto cut interest rates during a crisis erodes financial stability by increasing the riskof bank runs.

Nominal debt as a burden on monetary policy

We study the effects of nominal debt on the optimal sequential choice of monetary policy. When the stock of debt is nominal, the incentive to generate unanticipated inflation increases the cost of the outstanding debt even if no unanticipated inflation episodes occur in equilibrium. Without full commitment, the optimal sequential policy is to deplete the outstanding stock of debt progressively until these extra costs disappear. Nominal debt is therefore a burden on monetary policy, not only because it must be serviced, but also because it creates a time inconsistency problem that distorts interest rates. The introduction of alternative forms of taxation may lessen this burden, if there is enough commtiment to fiscal policy. If there is full commitment to an optimal fiscal policy, then the resulting monetary policy is the Friedman rule of zero nominal interest rates.

Monetary policy and unemployment

Much recent research has focused on the development and analysisof extensions of the New Keynesian framework that model labor marketfrictions and unemployment explicitly. The present paper describessome of the essential ingredients and properties of those models, andtheir implications for monetary policy.

Indoleamine 2,3-dioxygenase-expressing mature human monocyte-derived dendritic cells expand potent autologous regulatory T cells.

A comprehensive understanding of the complex, autologous cellular interactions and regulatory mechanisms that occur during normal dendritic cell (DC)-stimulated immune responses is critical to optimizing DC-based immunotherapy. We have found that mature, immunogenic human monocyte-derived DCs (moDCs) up-regulate the immune-inhibitory enzyme, indoleamine 2,3-dioxygenase (IDO). Under stringent autologous culture conditions without exogenous cytokines, mature moDCs expand regulatory T cells (Tregs) by an IDO-dependent mechanism. The priming of resting T cells with autologous, IDO-expressing, mature moDCs results in up to 10-fold expansion of CD4(+)CD25(bright)Foxp3(+)CD127(neg) Tregs. Treg expansion requires moDC contact, CD80/CD86 ligation, and endogenous interleukin-2. Cytofluorographically sorted CD4(+) CD25(bright)Foxp3(+) Tregs inhibit as much as 80% to 90% of DC-stimulated autologous and allogeneic T-cell proliferation, in a dose-dependent manner at Treg:T-cell ratios of 1:1, 1:5, and as low as 1:25. CD4(+)CD25(bright)Foxp3(+) Tregs also suppress the generation of cytotoxic T lymphocytes specific for the Wilms tumor antigen 1, resulting in more than an 80% decrease in specific target cell lysis. Suppression by Tregs is both contact-dependent and transforming growth factor-beta-mediated. Although mature moDCs can generate Tregs by this IDO-dependent mechanism to limit otherwise unrestrained immune responses, inhibition of this counter-regulatory pathway should also prove useful in sustaining responses stimulated by DC-based immunotherapy.

Biodiesel Facility Regulatory Assistance Guide, 2008

This guide is a general outline for bio diesel facilities on potential regulatory requirements and regulatory agency approval times. Much of the information is related to environmental permitting by the Iowa Department of Natural Resources (IDNR). Your facility’s permit requirements may differ depending upon the specific operations planned. Information is also provided about regulatory requirements administered by the Iowa Workforce Development, Labor Services Division and the Iowa Department of Public Safety, Fire Marshal Division. Requirements established by local units of government may also apply. Be sure to contact the city in which the facility will be located or the county if the facility is not located in a city, to identify these requirements.

Ethanol Facility Regulatory Assistance Guide, May 19, 2008

This guide is a general outline for ethanol facilities on potential regulatory requirements and regulatory agency approval times. Much of the information is related to environmental permitting by the Iowa Department of Natural Resources (IDNR). Your facility’s permit requirements may differ depending upon the specific operations planned. Information is also provided about regulatory requirements administered by the Iowa Workforce Development, Labor Services Division and the Iowa Department of Public Safety, Fire Marshal Division. Requirements established by local units of government may also apply. Be sure to contact the city in which the facility will be located or the county if the facility is not located in a city, to identify these requirements.

Propane Regulatory Assistance Guilty,

This fact sheets summarizes, in brief form, the compliance requirements for transportation, storage, handling and use of propane. It is not intended to provide comprehensive guidance on regulatory compliance for those dealing with propane, but to highlight those requirements and to assist those who may be affected by the various requirements to obtain detailed information when needed. Information about requirements which apply to the use of propane as a motor fuel is not included.

Regulatory Assistance, March 12, 2009

The Iowa Business and Regulatory Assistance Network ensures access and responsiveness to inquiries and requests for assistance from citizens, small business, industry and local governments. Facilitated by the Iowa Department of Economic Development (IDED), Business Assistance Coordinators in agencies across state government coordinate regulatory response and service. You may contact IDED or any of the agency contacts listed in this publication for assistance.

Taking "Galton's problem" Seriously : Towards a Theory of Policy Diffusion

This article builds on the recent policy diffusion literature and attempts to overcome one of its major problems, namely the lack of a coherent theoretical framework. The literature defines policy diffusion as a process where policy choices are interdependent, and identifies several diffusion mechanisms that specify the link between the policy choices of the various actors. As these mechanisms are grounded in different theories, theoretical accounts of diffusion currently have little internal coherence. In this article we put forward an expected-utility model of policy change that is able to subsume all the diffusion mechanisms. We argue that the expected utility of a policy depends on both its effectiveness and the payoffs it yields, and we show that the various diffusion mechanisms operate by altering these two parameters. Each mechanism affects one of the two parameters, and does so in distinct ways. To account for aggregate patterns of diffusion, we embed our model in a simple threshold model of diffusion. Given the high complexity of the process that results, strong analytical conclusions on aggregate patterns cannot be drawn without more extensive analysis which is beyond the scope of this article. However, preliminary considerations indicate that a wide range of diffusion processes may exist and that convergence is only one possible outcome.

Immigration policy with partisan parties

This paper analyzes the political economy of immigration when the salient electoralissue is the level of immigrants and the relevant immigration policy is the expenditurein immigration control. We consider that immigration affects voters? welfarethrough economic and non economic factors. We model political competition `a laWittman with the ideology of parties endogenously determined at equilibrium. Atequilibrium, parties propose different levels of immigration, located to the left and tothe right of the median voter?s ideal point, and combine skilled and unskilled workersamong their constituencies. Numerical simulations provide the levels of immigrationproposed by the two parties and the composition of parties? constituencies as we varythe efficacy of immigration control and the intensity of immigration aversion.

The policy relevance of wear emissions from road transport, now and in the future : an international workshop report and consensus statement

Road transport emissions are a major contributor to ambient particulate matter concentrations and have been associated with adverse health effects. Therefore, these emissions are targeted through increasingly stringent European emission standards. These policies succeed in reducing exhaust emissions, but do not address "nonexhaust" emissions from brake wear, tire wear, road wear, and suspension in air of road dust. Is this a problem? To what extent do nonexhaust emissions contribute to ambient concentrations of PM10 or PM2.5? In the near future, wear emissions may dominate the remaining traffic-related PM10 emissions in Europe, mostly due to the steep decrease in PM exhaust emissions. This underlines the need to determine the relevance of the wear emissions as a contribution to the existing ambient PM concentrations, and the need to assess the health risks related to wear particles, which has not yet received much attention. During a workshop in 2011, available knowledge was reported and evaluated so as to draw conclusions on the relevance of traffic-related wear emissions for air quality policy development. On the basis of available evidence, which is briefly presented in this paper, it was concluded that nonexhaust emissions and in particular suspension in air of road dust are major contributors to exceedances at street locations of the PM10 air quality standards in various European cities. Furthermore, wear-related PM emissions that contain high concentrations of metals may (despite their limited contribution to the mass of nonexhaust emissions) cause significant health risks for the population, especially those living near intensely trafficked locations. To quantify the existing health risks, targeted research is required on wear emissions, their dispersion in urban areas, population exposure, and its effects on health. Such information will be crucial for environmental policymakers as an input for discussions on the need to develop control strategies.