Monetary policy, expectations and commitment

Scandinavian Journal of Economics

Volumn 108, Issue 1, 2006, Pages 15-38

  Evans, George W ^a   Honkapohja, Seppo ^b  

^a UNIVERSITY OF OREGON   (United States)

^b UNIVERSITY OF CAMBRIDGE   (United Kingdom)

Author keywords

Commitment; Determinacy; Interest rate rule; Learning; Stability

Indexed keywords

INTEREST RATE; MONETARY POLICY;

EID: 33645045900     PISSN: 03470520     EISSN: 14679442     Source Type: Journal    
DOI: 10.1111/j.1467-9442.2006.00437.x     Document Type: Article

References (30)

1. Bernanke, B. and Woodford, M. (1997), Inflation Forecasts and Monetary Policy, NBER Working Paper no. WP6157.
2. Bullard, J. and Mitra, K. (2002), Learning About Monetary Policy Rules, Journal of Monetary Economics 49, 1105-1129.
3. Calvo, G. A. (1983), Staggered Pricing in a Utility-maximizing Framework, Journal of Monetary Economics 12, 383-398.
4. Clarida, R., Gali, J. and Gertler, M. (1999), The Science of Monetary Policy: A New Keynesian Perspective, Journal of Economic Literature 37, 1661-1707.
5. Clarida, R., Gali, J. and Gertler, M. (2000), Monetary Policy Rules and Macroeconomic Stability: Evidence and Some Theory, Quarterly Journal of Economics 115, 147-180.
6. Erceg, C., Henderson, D. and Levin, A. (2000), Optimal Monetary Policy with Staggered Wage and Price Contracts, Journal of Monetary Economics 46, 281-313.
7. Evans, G. W. and Honkapohja, S. (1999), Learning Dynamics, in J. Taylor and M. Woodford (eds.), Handbook of Macroeconomics Vol. 1, Elsevier, Amsterdam, 449-542.
8. Evans, G. W. and Honkapohja, S. (2001), Learning and Expectations in Macroeconomics, Princeton University Press, Princeton, NJ.
9. Evans, G. W. and Honkapohja, S. (2003a), Adaptive Learning and Monetary Policy Design, Journal of Money, Credit, and Banking 35, 1045-1072.
10. Evans, G. W. and Honkapohja, S. (2003b), Expectations and the Stability Problem for Optimal Monetary Policies, Review of Economic Studies 70, 807-824.
11. Evans, G. W. and Honkapohja, S. (2004), Monetary Policy, Expectations and Commitment, Economics Working Paper no. 2002-11, revised 2004-02-01, University of Oregon, http://www.darkwing.uoregon.edu/~gevans/.
12. Evans, G. W., Honkapohja, S. and Marimon, R. (2001), Convergence in Monetary Inflation Models with Heterogeneous Learning Rules, Macroeconomic Dynamics 5, 1-31.
13. Honkapohja, S., Mitra, K. and Evans, G. W. (2002), Notes on Agents' Behavioral Rules under Adaptive Learning and Recent Studies of Monetary Policy, manuscript, http://www.valt.helsinki.fi/RAKA/seppo.hmtl, and http://www.darkwing.uoregon.edu/~gevans.
14. Jensen, C. and McCallum, B. T. (2002), The Non-optimality of Proposed Monetary Policy Rules under Timeless-perspective Commitment, Economics Letters 75, 163-168.
15. Leeper, E. M. (1991), Equilibria under "Active" and "Passive" Monetary and Fiscal Policies, Journal of Monetary Economics 27, 129-147.
16. Marcet, A. and Sargent, T. J. (1989), Convergence of Least-squares Learning Mechanisms in Self-referential Linear Stochastic Models, Journal of Economic Theory 48, 337-368.
17. Marimon, R. (1997), Learning from Learning in Economics, in D. Kreps and K. Wallis (eds.), Advances in Economics and Econometrics: Theory and Applications, Vol. I, Cambridge University Press, Cambridge, 278-315.
18. McCallum, B. T. (1983), On Nonuniqueness in Linear Rational Expectations Models: An Attempt at Perspective, Journal of Monetary Economics 11, 139-168.
19. McCallum, B. T. and Nelson, E. (1999), Performance of Operational Policy Rules in an Estimated Semi-classical Model, in J. Taylor (ed.), Monetary Policy Rules, University of Chicago Press, Chicago, IL, 15-45.
20. McCallum, B. T. and Nelson, E. (2004), Timeless Perspective vs. Discretionary Monetary Policy in Forward-looking Models, Federal Reserve Bank of St. Louis Review 86, 43-56.
21. Preston, B. (2005), Learning about Monetary Policy Rules when Long-horizon Forecasts Matter, Journal of Central Banking 1, 81-126.
22. Rotemberg, J. J. and Woodford, M. (1999), Interest Rate Rules in an Estimated Sticky-price Model, in S. Taylor (ed.), Monetary Policy Rules, University of Chicago Press, Chicago, IL, 57-119.
23. Sargent, T. J. (1993), Bounded Rationality in Macroeconomics, Oxford University Press, Oxford.
24. Svensson, L. E. O. (1999), Inflation Targeting as a Monetary Policy Rule, Journal of Monetary Economics 43, 607-654.
25. Svensson, L. E. O. (2003), What is Wrong with Taylor Rules?Using Judgement in Monetary Policy through Targeting Rules, Journal of Economic Literature 41, 426-477.
26. Svensson, L. E. O. and Woodford, M. (2005), Implementing Optimal Policy through Inflation-forecast Targeting, in B. Bernanke and M. Woodford (eds.), The Inflation-targeting Debate, University of Chicago Press, Chicago, IL, 19-83.
27. Woodford, M. (1996), Control of the Public Debt: A Requirement for Price Stability?, NBER Working Paper no. WP5684.
28. Woodford, M. (1999a), Commentary: How Should Monetary Policy Be Conducted in an Era of Price Stability?, in Federal Reserve Bank, K.C., New Challenges for Monetary Policy, Federal Reserve Bank of Kansas City, Kansas City, MO, 277-316.
29. Woodford, M. (1999b), Optimal Monetary Policy Inertia, The Manchester School, Supplement 67, 1-35.
30. Woodford, M. (2003), Interest and Prices: Foundations of a Theory of Monetary Policy, Princeton University Press, Princeton, NJ.