From this topic onwards, we will address the policy aspects of monetary economics, drawing on what we have learned about the working of the economy from the previous lectures.
We start with the issue of the time inconsistency of economic policy. Presentation will be relatively short and sweet, given the simplicity of the model, but the implication is pretty significant. Key first reading is the relevant chapter in Romer's Advanced Macro book, but I also attach the original 2 papers on the topic to the reading pack, which can be downloaded here.
To avoid the nightmarish scenario where you come up to me 1 day before (or worse, after) the exam to ask "what is time inconsistency really?", here's a good narrative exposition by Greg Mankiw.
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