Imperfect knowledge and monetary policy

Author(s)

• Issing, Otmar
• Gaspar, Vítor
• Tristani, Oreste
• Vestin, David

Bibliographic Information

Imperfect knowledge and monetary policy

Otmar Issing and Vítor Gaspar with Oreste Tristani and David Vestin

（The Stone lectures in economics）

Cambridge University Press, 2005

• : pbk
• : hardback

Note

Includes bibliographical references (p. 122-135) and index

Description and Table of Contents

Description

Based on lectures given as part of The Stone Lectures in Economics, this book discusses the problem of formulating monetary policy in practice, under the uncertain circumstances which characterize the real world. The first lecture highlights the limitations of decision rules suggested by the academic literature and recommends an approach involving, first, a firm reliance on the few fundamental and robust results of monetary economics and, secondly, a pragmatic attitude to policy implementation, taking into consideration lessons from central banking experience. The second lecture revisits Milton Friedman's questions about the effects of active stabilization policies on business cycle fluctuations. It explores the implications of a simple model where the policy maker has imperfect knowledge about potential output and the private sector forms expectations according to adaptive learning. This lecture shows that imperfect knowledge limits the scope for active stabilization policy and strengthens the case for conservatism.

Table of Contents

• Acknowledgments
• Introduction
• Outline of the two lectures
• First lecture: Monetary Policy in Uncharted Territory. 1. Introduction
• 2. Uncharted territory: unique historical events
• 3. Achieving price stability
• 4. Avoiding excess volatility in inflation, output and the interest rate
• 5. Pragmatic monetarism: The Bundesbank
• 6. A stability-oriented strategy: the ECB
• 7. Conclusions
• Second lecture: Imperfect Knowledge, Learning and Conservatism. 1. Introduction
• 2. Time inconsistency, cost-push shocks and Rogoff's conservatism
• 3. Empirical output gap uncertainty
• 4. Output gap uncertainty, learning and conservatism
• 5. Different degrees of CB's knowledge and information
• 6. Conclusions
• References.

by "Nielsen BookData"

Details

• NCID: BA75718998
• ISBN:
  • 0521671078
  • 0521854865
• Country Code: uk
• Title Language Code: eng
• Text Language Code: eng
• Place of Publication: Cambridge
• Pages/Volumes: xi, 138 p.
• Size: 22 cm
• Subject Headings:
  • LCSH : Monetary policy
• Parent Bibliography ID:
  • BA66144413