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Optimal Monetary Policy at the ZeroInterestRate Bound

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FIG. 1. Optimal Responses under Discretion
FIG. 2. Optimal Responses under Commitment
TABLE 3  SENSITIVITY  ANALYSIS  TC  p  =  0.99  0.97  0.95  0.93  0.91  3  =  0.05/42  5  5  5  5  5  0.10/42  5  5  5  5  5  0.15/42  4  4  4  4  4  0.20/42  4  4  4  4  4  0.25/42  3  3  3  3  3  TC  K =  0.02  0.04  0.06  0.08  0.10  o  =  0.05  3  4  4

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