Explicit instrument versus targeting rules in the backward-looking model
In the backward-looking model, an explicit instrument rule is almost as efficient as a target rule. An explicit instrument rule leads to a more stable real rate of interest and hence an output stabilization bias compared to the target rule.
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- Lars E. O. Svensson, 2003.
"What Is Wrong with Taylor Rules? Using Judgment in Monetary Policy through Targeting Rules,"
Journal of Economic Literature,
American Economic Association, vol. 41(2), pages 426-477, June.
- Lars E. O. Svensson, 2003. "What is Wrong with Taylor Rules? Using Judgment in Monetary Policy through Targeting Rules," NBER Working Papers 9421, National Bureau of Economic Research, Inc.
- Lars E.O. Svensson, 2002. "What Is Wrong with Taylor Rules? Using Judgment in Monetary Policy through Targeting Rules," Working Papers 118, Princeton University, Department of Economics, Center for Economic Policy Studies..
- Richard T. Froyen & Alfred V. Guender, 2007. "Optimal Monetary Policy under Uncertainty," Books, Edward Elgar, number 12510, July.
- Bennett T. McCallum & Edward Nelson, 2005.
"Targeting versus instrument rules for monetary policy,"
Board of Governors of the Federal Reserve System (U.S.), pages 225-245.
- Bennett T. McCallum & Edward Nelson, 2005. "Targeting versus instrument rules for monetary policy," Review, Federal Reserve Bank of St. Louis, issue Sep, pages 597-612.
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