Advanced Search
MyIDEAS: Login to save this paper or follow this series

Communication, Learning and Optimal Monetary Policy

Contents:

Author Info

  • Tesfaselassie, M.F.

    (Tilburg University)

Abstract

The second part of the thesis deals with interest rate policy under inflation targeting when there is uncertainty in the term structure of interest rates emanating from unobserved, possibly volatile, market sentiments. In situations where expectations depend on the state of the economy--the rate of inflation and the level of the output gap, the central bank faces uncertainty about the degree of persistence in aggregate demand and inflation. Interestingly, the speed of learning about the degree of persistence depends on the interest rate policy followed and the resulting variability in inflation and the output gap, where higher variability speeds up learning and improves control of inflation in the long run. The analysis shows that passive and active learning scenarios have different implications for the degree of response of the rate of interest to the state of the economy and thus for the short-run conduct of monetary policy.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://arno.uvt.nl/show.cgi?fid=47034
Our checks indicate that this address may not be valid because: 404 Not Found. If this is indeed the case, please notify (Economists Online Support)
Download Restriction: no

Bibliographic Info

Paper provided by Tilburg University in its series Open Access publications from Tilburg University with number urn:nbn:nl:ui:12-173210.

as in new window
Length: 136
Date of creation: 2005
Date of revision:
Publication status: Published
Handle: RePEc:ner:tilbur:urn:nbn:nl:ui:12-173210

Note: Dissertation
Contact details of provider:
Web page: http://www.tilburguniversity.edu/

Related research

Keywords:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Woodford, Michael, 2000. "Optimal Monetary Policy Inertia," Seminar Papers, Stockholm University, Institute for International Economic Studies 666, Stockholm University, Institute for International Economic Studies.
  2. Rudebusch, Glenn D & Svensson, Lars E O, 2000. "Eurosystem Monetary Targeting: Lessons from US Data," CEPR Discussion Papers, C.E.P.R. Discussion Papers 2522, C.E.P.R. Discussion Papers.
  3. Stephen Pollock, 2002. "Recursive Estimation in Econometrics," Working Papers, Queen Mary, University of London, School of Economics and Finance 462, Queen Mary, University of London, School of Economics and Finance.
  4. Tarkka, Juha & Mayes, David, 1999. "The Value of Publishing Official Central Bank Forecasts," Research Discussion Papers, Bank of Finland 22/1999, Bank of Finland.
  5. Schaling, E., 1998. "The Nonlinear Phillips Curve and Inflation Forecast Targeting - Symmetric Versus Asymmetric Monetary Policy Rules," Discussion Paper, Tilburg University, Center for Economic Research 1998-136, Tilburg University, Center for Economic Research.
  6. Pollock, D. S. G., 2003. "Recursive estimation in econometrics," Computational Statistics & Data Analysis, Elsevier, Elsevier, vol. 44(1-2), pages 37-75, October.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Tesfaselassie, M.F. & Schaling, E. & Eijffinger, S.C.W., 2006. "Learning About the Term Structure and Optimal Rules for Inflation Targeting," ERIM Report Series Research in Management, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasm ERS-2006-058-F&A, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:ner:tilbur:urn:nbn:nl:ui:12-173210. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Economists Online Support).

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.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with 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 profile, as there may be some citations waiting for confirmation.

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