Learning and the central bank

Charles Carlstrom and Timothy Fuerst

No 117, Working Papers (Old Series) from Federal Reserve Bank of Cleveland

Abstract: It is well known that sunspot equilibria may arise under an interest-rate operating procedure in which the central bank varies the nominal rate with movements in future inflation (a forward-looking Taylor rule). This paper demonstrates that these sunspot equilibria may be learnable in the sense of E-stability.

Keywords: Banks and banking, Central; Monetary policy (search for similar items in EconPapers)
Date: 2001
New Economics Papers: this item is included in nep-cba, nep-dge, nep-mon and nep-pke
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Citations: View citations in EconPapers (10)

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Journal Article: Learning and the central bank (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedcwp:0117

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DOI: 10.26509/frbc-wp-200117

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