Zins- und Geldmengensteuerung in der offenen Volkswirtschaft: Eine Referenz an William Poole (und zugleich eine Kritik an der "Neuen Keynesianischen Makroökonomik")
Given all the evidence supporting Milton Friedman's proposition that inflation is now and every-where a monetary phenomenon, it seems that we are wrong when we tend to ignore the behaviour of the monetary aggregates at our peril. The total neglect of information about the monetary aggregates in the Taylor rule is a strong signal into that erroneous direction. Moreover, so-called "New Keynesianism" has put forward that there is no more need to treat the money market equilibrium in an "LM-setting". Our paper goes back to William Poole's analysis of interest rate and money supply rules and extends his earlier analysis to the open economy, alternative exchange rate regimes and various types of shocks. The results achieved confirm not only that the inclusion of the money market equilibrium enhances the possibilities to compare the costs and benefits of different monetary strategies, but also suggests that monetary strategies such as Taylor rules can be improved when opening up natural avenues to extend the rule by considering monetary aggregates.
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57, Board of Governors of the Federal Reserve System (U.S.).
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