Optimal monetary policy for the EMU accession countries. A new Keynesian approach
Board of Governors of the Federal Reserve System
Two-sector (traded and nontraded) small open economy DSGE model with Calvo price stickiness in both sectors, complete asset markets, home bias in consumption, and Maastricht convergence criteria constraints on CPI inflation, nominal interest ra
monopolistic competition in both sectors with Calvo price setting; linear production in labor
Table 4 p.1445
Constrained optimal policy satisfying Maastricht criteria - home traded sector inflation mean