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The Fed’s perceived Phillips curve: Evidence from individual FOMC forecasts

  • Peter Tillmann

    ()

    (Justus Liebig University Gießen)

This note uncovers the Phillips curve trade-off perceived by U.S. monetary policymakers. For that purpose we use data on individual forecasts for unemployment and inflation submitted by each individual FOMC member, which was recently made available for the period 1992-1998. The results point to significant changes in the perceived trade-off over time with the Phillips curve flattening and the implied NAIRU falling towards the second half of the sample. Hence, the results suggest that policymakers were aware of these changes in real-time.

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File URL: http://www.uni-marburg.de/fb02/makro/forschung/magkspapers/46-2009_tillmann.pdf
File Function: First version, 2009
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Paper provided by Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung) in its series MAGKS Papers on Economics with number 200946.

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Length: 16 pages
Date of creation: 2009
Date of revision:
Publication status: Forthcoming in
Handle: RePEc:mar:magkse:200946
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  1. Orphanides, Athanasios & Wieland, Volker, 2008. "Economic projections and rules-of-thumb for monetary policy," CFS Working Paper Series 2008/16, Center for Financial Studies (CFS).
  2. Carmona, Carlos Capistran, 2005. "Bias in Federal Reserve Inflation Forecasts: Is the Federal Reserve Irrational or Just Cautious?," University of California at San Diego, Economics Working Paper Series qt6v28v0b6, Department of Economics, UC San Diego.
  3. Ellen E. Meade & Daniel L. Thornton, 2012. "The Phillips curve and US monetary policy: what the FOMC transcripts tell us," Oxford Economic Papers, Oxford University Press, vol. 64(2), pages 197-216, April.
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    • Martin Ellison & Thomas J. Sargent, 2012. "A Defense Of The Fomc," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 53(4), pages 1047-1065, November.
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