ECIN Replication Package for "Measuring the U.S. monetary noise shocks"

<span><a target="_blank" rel="nofollow">Agents’
beliefs regarding future monetary policy changes influence their current
decisions. However, these expectations may not always materialize in the
future. This study shows that the monetary fundamental shocks (exogenous
changes consistent with expectations) stabilize output and inflation, while the
noise shocks (biased beliefs that fail to be realized in the future) increase</a> economic fluctuations.
Moreover, factors that amplify financial frictions – the spread between the
capital return of entrepreneurs and the risk-free interest rate of a central
bank – can increase anticipation effects associated with these two types of
monetary policy shocks.</span>