Solving for Optimal Simple Rules in Rational-Expectations Models

Richard Dennis

No 2000-14, Working Paper Series from Federal Reserve Bank of San Francisco

Abstract: This paper presents techniques to solve for optimal simple monetary policy rules in rational expectations models, assuming discretion. The techniques described are notable for the flexibility they provide over the structure of the policy rule being solved for. Specifically, not all state variables need enter the policy rule allowing rules optimal conditional on a given information set to be easily constructed. The algorithms described are compared to related solution methods, and applied to the model in Clarida, Gali, and Gertler (1999).

Keywords: discretion; Econometric models; Rational expectations (Economic theory) (search for similar items in EconPapers)
JEL-codes: C61 C62 E58 (search for similar items in EconPapers)
Pages: 34
Date: 2003-03-01
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Solving for optimal simple rules in rational expectations models (2004)
Working Paper: Solving for Optimal Simple Rules in Rational Expectations Models (2001)
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedfwp:2000-14

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DOI: 10.24148/wp2000-14

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