Did the Great Inflation Occur Despite Policymaker Commitment to a Taylor Rule?
نویسندگان
چکیده
منابع مشابه
Taylor Rule: A Model for the Mechanism of Monetary Policy and Inflation Control in the Framework of the Interest-Free Banking Act
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 ...
متن کاملHow Largely Can Commitment Beat Policy-makers’ Misperception?
Extended Abstract This paper investigates the assumption that policy-makers commit to a Taylor rule, using an inflation-unemployment dynamic model for the US economy. Our approach differs from previous work as we model policymakers’ belief as a latent variable rather than as represented by observed nominal interest rate. Our paper is based on the conjecture that policy-maker’s misperception ori...
متن کاملImperfect Information, Optimal Monetary Policy and the Informational Consistency Principle∗
This paper examines the implications of imperfect information for optimal monetary policy with a consistent set of informational assumptions for the modeller and the private sector. The assumption that agents have no more information than the economist who constructs and estimates the model on behalf of the policymaker, amounts to what we term the informational consistency principle. We use an ...
متن کاملقاعدهی گسترش یافته تیلور: مطالعه موردی ایران 86-1357
The ultimate goals of the monetary policy are price stability and the output growth. Monetary policy instruments are interest rate and the growth rate of monetary base. One of the well-known rules in conducting monetary policy is Taylor rule, through which, central banks change the interest rate while taking into account the output and inflation distortions. There are two problems with applyi...
متن کاملInfrequent Changes of Policy Target: Stop-Go Monetary Policy under Ambiguity
In many countries, the monetary policy instrument remains unchanged for a long period and shows infrequent responses to exogenous shocks. The purpose of this paper is to provide a new explanation on why the central bank’s policy instrument remains so unchanged. In the following analysis, we explore how Knightian uncertainty affects optimal monetary policy. We apply the Choquet expected decision...
متن کامل