Monetary policy more effective in recessions, lagged prices predict business cycles.
The article presents a model that looks at how the US economy behaves during different phases of the business cycle and how monetary policy affects these phases. The researchers used a complex statistical method to analyze a lot of data and found that monetary policy has a bigger impact during recessions compared to times of economic growth. They also discovered that past price changes can help predict when the economy will shift from one phase to another.