IDEAS home Printed from https://ideas.repec.org/a/fip/fedreb/y2011ijuln11-7.html
   My bibliography  Save this article

Monetary policy with unknown natural rates

Author

Listed:

Abstract

The "unemployment gap" is an important factor in monetary policy decisions. But the size of the gap depends on the level of natural rate of unemployment, which is inherently unobservable. The uncertainty surrounding estimates of the natural rate, and the costs of mismeasuring it, may recommend a policy rule that responds to the rate of change in the actual unemployment rate rather than to the implied unemployment gap.

Suggested Citation

  • Thomas A. Lubik & Jessica Sackett Romero, 2011. "Monetary policy with unknown natural rates," Richmond Fed Economic Brief, Federal Reserve Bank of Richmond, issue Jul.
    • Handle: RePEc:fip:fedreb:y:2011:i:jul:n:11-7
    as

    Download full text from publisher

    File URL: http://www.richmondfed.org/publications/research/economic_brief/2011/pdf/eb_11-07.pdf
    Download Restriction: no
    File URL: http://www.richmondfed.org/publications/research/economic_brief/2011/eb_11-07.cfm
    Download Restriction: no
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fip:fedreb:y:2011:i:jul:n:11-7. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Christian Pascasio (email available below). General contact details of provider: https://edirc.repec.org/data/frbrius.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.