Hopf Bifurcation from new-Keynesian Taylor rule to Ramsey Optimal Policy

• Tác giả: Jean-Bernard Chatelain, Kirsten Ralf
• Ngôn ngữ: eng
• Ký hiệu phân loại: 332.46 Monetary policy
• Thông tin xuất bản: 2020
• Bộ sưu tập: Metadata
• ID: 163966

Tóm tắt

Comment: Macroeconomic Dynamics, Cambridge University Press (CUP), 2020This paper compares different implementations of monetary policy in a new-Keynesian setting. We can show that a shift from Ramsey optimal policy under short-term commitment (based on a negative feedback mechanism) to a Taylor rule (based on a positive feedback mechanism) corresponds to a Hopf bifurcation with opposite policy advice and a change of the dynamic properties. This bifurcation occurs because of the ad hoc assumption that interest rate is a forward-looking variable when policy targets (inflation and output gap) are forward-looking variables in the new-Keynesian theory.