Title of article :
When isdiscretionsuperiortotimelessperspectivepolicymaking
Author/Authors :
Richard Dennis، نويسنده ,
Issue Information :
روزنامه با شماره پیاپی سال 2010
Abstract :
The monetarypolicyliteratureassumesincreasinglythatpolicyisformulatedaccording
to thetimelessperspective(Woodford,1999a). However,bytreatingappropriatelythe
auxiliarystatevariablesthatcharacterizethetimelessperspectiveequilibriumwhen
evaluatingpolicyperformance,thispapershowsthatdiscretionarypolicymakingcanbe
superiortotimelessperspectivepolicymakingandidentifiesmodelfeaturesthatmake
thisoutcomemorelikely.UsingstandardNewKeynesianDSGEmodels,discretionis
foundtodominatetimelessperspectivepolicymakingwhentheprice/wagePhillips
curvesarerelativelyflat,due,perhaps,tofirm-specificcapital(orlabor)and/or Kimball
(1995) aggregationincombinationwithnominalrigidities.Theseresultssuggestthat
studiesapplyingthetimelessperspectivemightalsousefullycompareitsperformance
to discretion,payingcarefulattentiontohowpolicyperformanceisevaluated
Keywords :
DiscretionTimeless perspectivePolicy evaluation
Journal title :
Journal of Monetary Economics
Journal title :
Journal of Monetary Economics
