Is the Fed too timid? Monetary policy in an uncertain world

Glenn Rudebusch

No 99-05, Working Papers in Applied Economic Theory from Federal Reserve Bank of San Francisco

Abstract: Estimates of the Taylor rule using historical data from the past decade or two suggest that monetary policy in the U.S. can be characterized as having reacted in a moderate fashion to output and inflation gaps. In contrast, the parameters of optimal Taylor rules derived using empirical models of the economy often recommend much more vigorous policy responses. This paper attempts to match the historical policy rule with an optimal policy rule by incorporating uncertainty into the derivation of the latter.

Keywords: Monetary; policy (search for similar items in EconPapers)
Date: 1999
New Economics Papers: this item is included in nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (19)

Downloads: (external link)
https://www.frbsf.org/wp-content/uploads/wp99-05.pdf Full Text (text/html)

Related works:
Journal Article: Is The Fed Too Timid? Monetary Policy In An Uncertain World (2001)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fip:fedfap:99-05

Ordering information: This working paper can be ordered from

Access Statistics for this paper

More papers in Working Papers in Applied Economic Theory from Federal Reserve Bank of San Francisco Contact information at EDIRC.
Bibliographic data for series maintained by Federal Reserve Bank of San Francisco Research Library ().