Can we Identify Economic Policies Stabilizing an Unstable Economy ?

Peut-on identifier les politiques économiques stabilisant une économie instable ?

Kirsten Ralf and Jean-Bernard Chatelain

PSE-Ecole d'économie de Paris (Postprint) from HAL

Abstract: This paper shows that rules of optimal policy under commitment allow policymakers to lean against bubbles and to stabilize an unstable economy. In this framework, policymakers anchor the initial values of the expectations of the private sector. Then, this paper sets identification conditions for the parameters of optimal rules under commitment, of optimal and time consistent rules and of quasi-optimal rules. Finally, the paper concludes by presenting the pros and cons for each of these three types of policy rules for macroeconomic modelling, depending on a set of criteria.

Keywords: identification; stabilité; cohérence temporelle; Politique de stabilisation économique; engagement crédible (search for similar items in EconPapers)
Date: 2014
Note: View the original document on HAL open archive server: https://hal.science/hal-01305362v1
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Published in Revue Française d'Economie, 2014, 29 (2014/3), pp.143-178. ⟨10.3917/rfe.143.0143⟩

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Related works:
Working Paper: Can we Identify Economic Policies Stabilizing an Unstable Economy ? (2014)
Working Paper: Can we Identify Economic Policies Stabilizing an Unstable Economy ? (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:pseptp:hal-01305362

DOI: 10.3917/rfe.143.0143

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