Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5060835 | Economics Letters | 2011 | 4 Pages |
Abstract
⺠The optimal monetary policy requires weaker reaction to supply shock under commitment. ⺠The weaker reaction of monetary policy does not produce instability. ⺠In commitment, we get negative association of real interest with expected inflation. ⺠We conclude that under commitment, the Taylor principle for monetary policy fails.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Emanuel Barnea, Nissan Liviatan,