 Flexible Monetary Policy Rules from the Great Moderation to the New Normal Times (1993–2023): A Forward-Looking ReviewA chapter in Monetary Policy Normalization, 2023, pp 61-81 from Springer Abstract: Abstract The never-ending debate on the optimal money elasticity and predictability, coupled with the recent wishes of the major central banks to normalize monetary policy, motivate this analysis. Its aim is to offer a review of the evolution of the modern concept of flexible monetary policy rules, from the seminal contribution of (Taylor, Carnegie-Rochester Conference Series on Public Policy 39:195–214, 1993) to nowadays. Four subsequent steps are implemented: after an excursus on the traditional rules versus discretion debate, the origin of the flexible rules is described, and then its evolution; finally, the opportunity to consider as a research perspective the role of the central bankers’ heterogeneity—in terms of personal preferences, including the behavioural biases—is highlighted. The more it is likely that psychology matters, the more a new motivation arises for a central bank to adopt a flexible rule. Keywords: Rules versus discretion debate; Behavioural economics; Monetary policy normalization; Central bankers’ heterogeneity; John Taylor (search for similar items in EconPapers) There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:spr:conchp:978-3-031-38708-1_4 Ordering information: This item can be ordered from DOI: 10.1007/978-3-031-38708-1_4 Access Statistics for this chapter More chapters in Contributions to Economics from Springer |
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