Monetary Policy Rules, Learning and Stability: a Survey of the Recent Literature (In French)

Martin Zumpe

Cahiers du GREThA (2007-2019) from Groupe de Recherche en Economie Théorique et Appliquée (GREThA)

Abstract: This paper presents the literature about econometric learning and its impact on the performances of monetary policy rules in the framework of the new canonical macroeconomic model. Rational expectations which are a building block of the original model can thus be replaced by expectations based on estimation algorithms. The permanent updating of these estimations can be interpreted as a learning proces of the model’s agents. This learning proces induces additional dynamics into the model. The literature in question uses two criteria in order to analyse the ability of monetary policy rules to stabilise the economy: (i) uniqueness of the rational expectations equilibrium in the original model and (ii) stability in regards to learning in the modified model. Taking learning into account enables to detect shortcomings of a rule according to (ii) that would not been seen in a rational expectations model. However, the main message of the surveyed literature is that most of the results found in a rational expectations framework are robust. The paper ends with a discussion on the specific problems met in the introduction of a learning proces in the new canonical model.

Keywords: monetary; policy; rules; –; learning; –; determination; -; stability (search for similar items in EconPapers)
JEL-codes: D84 E31 E52 (search for similar items in EconPapers)
Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://cahiersdugretha.u-bordeaux.fr/2010/2010-01.pdf (application/pdf)

Related works:
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:grt:wpegrt:2010-01

Access Statistics for this paper

More papers in Cahiers du GREThA (2007-2019) from Groupe de Recherche en Economie Théorique et Appliquée (GREThA) Contact information at EDIRC.
Bibliographic data for series maintained by Ernest Miguelez ().