IDEAS home Printed from https://ideas.repec.org/p/hal/psewpa/halshs-00586883.html
   My bibliography  Save this paper

Monetary policy uncertainty and macroeconomic performance: An extended non-bayesian framework

Author

Listed:
  • Daniel Laskar

    (PSE - Paris School of Economics, PJSE - Paris-Jourdan Sciences Economiques - ENS Paris - École normale supérieure - Paris - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique)

Abstract

The existing literature has shown that less political uncertainty, or more central bank transparency, may worsen macroeconomic performance by raising the nominal wage. We extend this analysis to a non-bayesian framework, where there is some aversion to ambiguity. We show that the result found in the literature under the bayesian approach does not hold when the distance from the bayesian case is large enough, or when a reduction in Knigtian uncertainty is considered. Then, less uncertainty, or more transparency of the central bank, does not raise the nominal wage and, as a consequence, macroeconomic performance is not worsened (and is in general strictly improved).

Suggested Citation

  • Daniel Laskar, 2008. "Monetary policy uncertainty and macroeconomic performance: An extended non-bayesian framework," PSE Working Papers halshs-00586883, HAL.
  • Handle: RePEc:hal:psewpa:halshs-00586883
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00586883
    as

    Download full text from publisher

    File URL: https://halshs.archives-ouvertes.fr/halshs-00586883/document
    Download Restriction: no

    References listed on IDEAS

    as
    1. Gruener Hans Peter & Hayo Bernd & Hefeker Carsten, 2009. "Unions, Wage Setting and Monetary Policy Uncertainty," The B.E. Journal of Macroeconomics, De Gruyter, vol. 9(1), pages 1-25, October.
    2. Gruner, Hans Peter, 2002. "How much should central banks talk?: A new argument," Economics Letters, Elsevier, vol. 77(2), pages 195-198, October.
    Full references (including those not matched with items on IDEAS)

    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:hal:psewpa:halshs-00586883. 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: (CCSD). General contact details of provider: https://hal.archives-ouvertes.fr/ .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.