Arbeitspapier
Central bank learning and monetary policy
We analyze optimal monetary policy when a central bank has to learn about an unknown coefficient that determines the effect of surprise inflation on aggregate demand. We derive the optimal policy under active learning and compare it to two limiting cases-certainty equivalence policy and cautionary policy, in which learning takes place passively. Our novel result is that the two passive learning policies represent an upper and lower bound for the active learning policy, irrespective of the state of the economy.
- Language
-
Englisch
- Bibliographic citation
-
Series: Kiel Working Paper ; No. 1444
- Classification
-
Wirtschaft
Mathematical Methods
Monetary Policy
- Subject
-
Parameter uncertainty
learning
monetary policy
Geldpolitik
Kontrolltheorie
Entscheidung bei Unsicherheit
Inflation
Lernprozess
Theorie
- Event
-
Geistige Schöpfung
- (who)
-
Tesfaselassie, Mewael F.
- Event
-
Veröffentlichung
- (who)
-
Kiel Institute for the World Economy (IfW)
- (where)
-
Kiel
- (when)
-
2008
- Handle
- Last update
-
10.03.2025, 11:41 AM CET
Data provider
This object is provided by:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Tesfaselassie, Mewael F.
- Kiel Institute for the World Economy (IfW)
Time of origin
- 2008
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