THE APPRENTICE WIZARD: MONTETARY POLICY, COMPLEXITY AND LEARNING

Domenico Delli Gatti (), Edoardo Gaffeo (), Mauro Gallegati () and Antonio Palestrini ()
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Edoardo Gaffeo: Department of Economics and CEEL, University of Trento, Via Inama 5, I-38100 Trento, Italy

New Mathematics and Natural Computation (NMNC), 2005, vol. 01, issue 01, pages 109-128

Abstract: This paper investigates some central issues of monetary policy by offering a model in which a central bank tries to stabilize fluctuations in aggregate output and inflation in an adaptive complex economy. We resort to evolutionary algorithms to model the central bank behaviour under discretion, and confront the efficiency of discretion with the choice of full commitment to a fixed rule.

Keywords: Monetary policy; Taylor rule; learning (search for similar items in EconPapers)
Date: 2005

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