01733cas a2200253 a 4500 AALejournalIMF000282 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451853162 1018-5941 BD-DhAAL BD-DhAAL Chadha, Bankim. Inflation, Nominal Interest Rates, and the Variability of Output / Bankim Chadha, Daniel Tsiddon. Washington, D.C. : International Monetary Fund, 1996. 1 online resource (36 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper examines the distribution of output around capacity when money demand is a nonlinear function of the nominal interest rate such that nominal interest rates cannot become negative. When fluctuations in output result primarily from disturbances to the money market, the variance of output is shown to be an increasing function of the trend inflation rate. When they result from disturbances to the goods market, the variance of output is a decreasing function of the trend inflation rate. When both disturbances are significant, there exists, in general, a critical non-zero trend inflation rate that minimizes the variance of output. Mode of access: Internet Tsiddon, Daniel. IMF Working Papers; Working Paper ; No. 1996/109 Full text available on IMF http://elibrary.imf.org/view/journals/001/1996/109/001.1996.issue-109-en.xml IMF e-Library