| Article ID | Journal | Published Year | Pages | File Type |
|---|---|---|---|---|
| 5052832 | Economic Analysis and Policy | 2014 | 13 Pages |
Abstract
We investigate the effects of a monetary policy lag on equilibrium determinacy by using a New Keynesian (NK) continuous-time framework. If the lag is not very large, the result obtained will not be different from the standard one: an active monetary policy attains local equilibrium determinacy, which is a policy norm known as the Taylor principle. However, if the lag is sufficiently large, then no equilibrium will exist.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Eiji Tsuzuki,