Discussion of Preston, "Learning about monetary policy rules when long-horizon expectations matter"
AbstractThe design of interest rate rules for conducting monetary policy have recently been examined for two key concerns. The first issue is determinacy of equilibria. Indeterminacy (multiplicity of stationary rational expectations equilibria) is a concern in models of monopolistic competition and price stickiness are currently a popular framework for the study of monetary policy. The second issue is stability of equilibria under adaptive learning. Some interest rate rules do not perform well when the expectations of the agents get out of equilibrium, e.g. as a result of structural shifts.
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Bibliographic InfoPaper provided by Federal Reserve Bank of Atlanta in its series Working Paper with number 2003-19.
Date of creation: 2003
Date of revision:
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- James Bullard & Kaushik Mitra, 2002.
"Learning about monetary policy rules,"
2000-001, Federal Reserve Bank of St. Louis.
- Kobayashi, Teruyoshi & Muto, Ichiro, 2013.
"A Note On Expectational Stability Under Nonzero Trend Inflation,"
Cambridge University Press, vol. 17(03), pages 681-693, April.
- Kobayashi, Teruyoshi & Muto, Ichiro, 2010. "A note on expectational stability under non-zero trend inflation," MPRA Paper 22952, University Library of Munich, Germany.
- Teruyoshi Kobayashi & Ichiro Muto, 2011. "A note on expectational stability under non-zero trend inflation," Discussion Papers 1102, Graduate School of Economics, Kobe University.
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