The Taylor Rule and the Transformation of Monetary Policy

Koenig, E.; Leeson, Robert; Kahn, George A.

doi:10.2139/ssrn.1088466

Cited by 11 publications

(14 citation statements)

References 37 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Our modi…ed loss function could be interpreted as optimal policy with guidance from simple rules. This seems to be a reasonable description of how simple rules are used as cross-checks in practice, as described in Kahn (2012). An alternative interpretation is that the central bank uses a simple rule as a benchmark, but deviates from it when it …nds it appropriate to do so.…”

Section: +mentioning

confidence: 93%

“…We thank him for providing us with the MatLab code. 8 As a robustness check of our results, we also consider alternative weights. Those results are available upon request.…”

Section: Kahn (2012) and Ilbas Røisland And Sveen (2012) Second Itmentioning

confidence: 99%

“…Indeed, Kahn (2012) provides a thorough documentation on how simple Taylor-type rules have in ‡uenced the FOMC decisions and how they are used as cross-checks to the interest rate decisions in many central banks. An illustrative example is the FOMC meeting in January 31-February 1 1995, where the Greenbook suggested a 150 basis points increase of the federal funds rate to 7 percent.…”

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

Robustifying Optimal Monetary Policy Using Simple Rules as Cross-Checks

2012

View full text Add to dashboard Cite

Section: +mentioning

confidence: 93%

“…We thank him for providing us with the MatLab code. 8 As a robustness check of our results, we also consider alternative weights. Those results are available upon request.…”

Section: Kahn (2012) and Ilbas Røisland And Sveen (2012) Second Itmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

Robustifying Optimal Monetary Policy Using Simple Rules as Cross-Checks

2012

View full text Add to dashboard Cite

“…Kahn (2010) and Ahrend (2010) have provided evidence of monetary policy swinging away from rule-like policies. Kohn (2012) questioned using simple policy rules to make that judgement. More recently Lane (2016) cites evidence in an IMF Report (2015) that both "macroeconomic gaps" and "financial gaps" were large in several countries suggesting that interest rates should not have been so low.…”

Section: How Have the Various Rules Suggested For Monetary Policy Chamentioning

confidence: 99%

Rules Versus Discretion: Assessing the Debate Over the Conduct of Monetary Policy

Taylor¹

2017

View full text Add to dashboard Cite

This paper was presented at the Federal Reserve Bank of Boston's 61st Economic Conference, "Are Rules Made to be Broken? Discretion and Monetary Policy," on October 13, 2017. I thank the Boston Fed for asking me to assess the current state of the rules versus discretion debate at the conference, and I thank Matthew Canzoneri, V.V. Chari, Geovanni Olivei, David Papell, Eric Rosengren, and especially my discussant Donald Kohn for helpful comments. The views expressed herein are those of the author and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

show abstract

“…The forward-looking approach, which combines lagged values of variables one year ahead of forecasting, is more likely to capture the appropriate movement of the cash rate. Meanwhile, Kahn, Koenig, and Leeson (2012) advocate for the forward-looking approach since it is a true real-time policy that formulates the reaction function with respect to available forecasted information at the time that monetary decisions are made. The forward-looking approach is explicitly preferred as it considers the role of forecasting macroeconomic movements in finalizing decisions.…”

Section: Resultsmentioning

confidence: 99%

The Making of Contemporary Australian Monetary Policy - Backward- or Forward- Looking?

Chen¹,

Zhang²,

Tam³

et al. 2018

IJEF

View full text Add to dashboard Cite

Monetary authorities rarely disclose the true reasons behind their policy reactions. A tracing of the policy reaction function to see if the monetary authority is applying simple rules holds the potential to offer profound insight into the past behavioral relationship between the monetary authority and economic agencies. A reasonable body of knowledge about the direction of monetary policy would, moreover, assist economic agencies in forming their expectations, which would in turn, be useful for the monetary authority in anticipating the likely trends of the overall economy. The main objective of this study is to track de Brouwer and Gilbert (2005) from the Australian financial deregulation era (from 1983 to 2002) to the present. Empirical findings show that the Reserve Bank of Australia (RBA) is more forward-looking when formulating monetary policy rather than backward-looking, and that inflation targeting plays a significant role in stabilizing the output of the economy.

show abstract

The Taylor Rule and the Transformation of Monetary Policy

Cited by 11 publications

References 37 publications

Robustifying Optimal Monetary Policy Using Simple Rules as Cross-Checks

Robustifying Optimal Monetary Policy Using Simple Rules as Cross-Checks

Rules Versus Discretion: Assessing the Debate Over the Conduct of Monetary Policy

The Making of Contemporary Australian Monetary Policy - Backward- or Forward- Looking?

Contact Info

Product

Resources

About