The Taylor Rule and Optimal Monetary Policy
نویسندگان
چکیده
منابع مشابه
Historical monetary policy analysis and the Taylor rule
This study examines the usefulness of the Taylor-rule framework as an organizing device for describing the policy debate and evolution of monetary policy in the United States. Monetary policy during the 1920s and since the 1951 Treasury-Federal Reserve Accord can be broadly interpreted in terms of this framework with rather surprising consistency. In broad terms, during these periods policy has...
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This paper shows that monetary policy should be delegated to a central bank that cross-checks optimal policy with information from the Taylor rule. Attaching some weight to deviations of the interest rate from the interest rate prescribed by the Taylor rule is beneficial if the central bank aims at optimally stabilizing inflation and output gap variability under discretion. Placing a weight on ...
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This paper is motivated by the observation that the Great Inflation, i.e., the high and volatile inflation that developed in the mid 1960s and lasted for almost twenty years, was an international phenomenon. Given that observation, we argue that an explanation for the Great Inflation should be consistent with the timing of the events in many developed countries, and not only with the US. We pro...
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This paper is a revised English-language version of the author’s report at a workshop, “Asset-Price Fluctuations and Policy Responses: Experiences of Interwar Japan,” held by the Institute for Monetary and Economic Studies (IMES), Bank of Japan (December 20, 2001). The author has received many valuable comments from participants of the workshop, including Professor Masanao Ito of University of ...
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The ultimate goal of monetary policy is to achieve price stability and high output. In this regard, central banks usually change the interest rate, liquidity, and money base in order to apply monetary policies. The John B. Taylor rule is one of the rules known in the transmission of monetary policy.[1] Based on this rule and given the output gap and inflation gap, the central bank increases or ...
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ژورنال
عنوان ژورنال: American Economic Review
سال: 2001
ISSN: 0002-8282
DOI: 10.1257/aer.91.2.232