haku: @freeterm credibility / yhteensä: 8
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| Tekijä: | Lengwiler, Y. Orphanides, A. |
| Otsikko: | Optimal discretion |
| Lehti: | Scandinavian Journal of Economics
2002 : JUN, VOL. 104:2, p. 261-276 |
| Asiasana: | Inflation Central banks Markets Monetary policy Monetary theory Models |
| Vapaa asiasana: | Credibility |
| Kieli: | eng |
| Tiivistelmä: | This paper investigates the desirability of adopting a rule in favour of discretionary monetary policy in a model exhibiting Kydland and Prescott's dynamic inconsistency problem but no fundamental incompatibility btw. the policymaker's price stability and full employment objectives. It is shown that if discretion provides a policy flexibility benefit, then a rule is optimal only when inflation exceeds an endogenously determined threshold. |
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