Evaluating Alternative Monetary Policy Rules
This paper examines monetary policy from an optimal control perspective. Three loss functions are minimized for each of three models, and the results are compared. The three loss functions target nominal growth, real growth, and inflation, respectively. The three models are a small structural model, a VAR model, and a large structural model. A numerical procedure is presented that can handle a variety of loss functions and models.
|Date of creation:||Feb 1995|
|Publication status:||Published in Journal of Monetary Economics (1996), 38: 173-193|
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|Order Information:|| Postal: Cowles Foundation, Yale University, Box 208281, New Haven, CT 06520-8281 USA|
References listed on IDEAS
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"Nominal Income Targeting,"
NBER Chapters,in: Monetary Policy, pages 71-94
National Bureau of Economic Research, Inc.
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