Identification with Taylor Rules
Identification with Taylor Rules
About this book
The parameters of the Taylor rule relating interest rates to inflation and other variables are not identified in new-Keynesian models. Thus, Taylor rule regressions cannot be used to argue that the Fed conquered inflation by moving from a "passive" to an "active" policy in the early 1980s.
Details
- OL Work ID
- OL5730909W
Subjects
Inflation (Finance)Mathematical models