Discretion rather than rules? Outdated optimal commitment plans versus discretionary policymaking

References

al-Nowaihi, A., and P. Levine. 1994. “Can Reputation Resolve the Monetary Policy Credibility Problem?” Journal of Monetary Economics 33: 355–380.10.1016/0304-3932(94)90006-XSearch in Google Scholar

Atkeson, A., and R. Lucas. 1992. “On Efficient Distribution with Private Information.” Review of Economic Studies 59: 427–453.10.2307/2297858Search in Google Scholar

Assenmacher-Wesche, K. 2006. “Estimating Central Banks’ Preferences from a Time-Varying Empirical Reaction Function.” European Economic Review 50: 1951–1974.10.1016/j.euroecorev.2005.10.003Search in Google Scholar

Barro, R. J., and D. B. Gordon. 1983a. “A Positive Theory of Monetary Policy in a Natural Rate Model.” Journal of Political Economy 91: 589–610.10.1086/261167Search in Google Scholar

Barro, R. J., and D. B. Gordon. 1983b. “Rules, Discretion and Reputation in a Model of Monetary Policy.” Journal of Monetary Economics 12: 101–121.10.1016/0304-3932(83)90051-XSearch in Google Scholar

Blake, A. P. 2001. “A ‘Timeless Perspective’ on Optimality in Forward-Looking Rational Expectations Models.” Working paper, NIESR.Search in Google Scholar

Calvo, G. A. 1978. “On the Time Consistency of Optimal Policy in a Monetary Economy.” Econometrica 46: 1411–1428.10.2307/1913836Search in Google Scholar

Calvo, G. A. 1983. “Staggered Prices in a Utility Maximizing Framework.” Journal of Monetary Economics 12: 383–398.10.1016/0304-3932(83)90060-0Search in Google Scholar

Chari, V. V., and P. J. Kehoe. 1990. “Sustainable Plans.” Journal of Political Economy 98: 783–802.10.1086/261706Search in Google Scholar

Clarida, R., J. Gali, and M. Gertler. 1999. “The Science of Monetary Policy: A New Keynesian Perspective.” Journal of Economic Literature 37: 1661–1707.10.1257/jel.37.4.1661Search in Google Scholar

Currie, D., and P. Levine. 1993. Rules, Reputation and Macroeconomic Policy Coordination, Cambridge, UK: Cambridge University Press.10.1017/CBO9780511599170Search in Google Scholar

Damjanovic, T., V. Damjanovic, and C. Nolan. 2008. “Unconditionally Optimal Monetary Policy.” Journal of Monetary Economics 55: 491–500.10.1016/j.jmoneco.2008.01.003Search in Google Scholar

Dennis, R. 2001. “Pre-Commitment, the Timeless Perspective, and Policymaking from Behind a Veil of Uncertainty.” Working paper, Federal Reserve Bank of San Francisco.10.2139/ssrn.721063Search in Google Scholar

Dennis, R. 2004. “Inferring Policy Objectives from Economic Outcomes.” Oxford Bulletin of Economics and Statistics 66: 735–764.10.1111/j.1468-0084.2004.100_1.xSearch in Google Scholar

Dennis, R. 2010. “When is Discretion Superior to Timeless Perspective Policymaking?” Journal of Monetary Economics 57: 266–277.10.1016/j.jmoneco.2010.02.006Search in Google Scholar

Givens, G. E. 2012. “Estimating Central Bank Preferences under Commitment and Discretion.” Journal of Money, Credit and Banking 44: 1033–1061.10.1111/j.1538-4616.2012.00522.xSearch in Google Scholar

Green, E. 1987. “Lending and the Smoothing of Uninsurable Income.” In Contractual Arrangements for Intertemporal Trade, edited by E. Prescott, and N. Wallace. Minneapolis, MN: University of Minnesota Press.Search in Google Scholar

Jensen, C. 2001. “Optimal Monetary Policy in Forward-Looking Models with Rational Expectations.” Working paper, Carnegie Mellon University.Search in Google Scholar

Jensen, C., and B. T. McCallum. 2010. “Optimal Continuation versus the Timeless Perspective in Monetary Policy.” Journal of Money, Credit and Banking 42: 1093–1107.10.1111/j.1538-4616.2010.00321.xSearch in Google Scholar

Judd, K. 1985. “Redistributive Taxation in a Simple Perfect Foresight Model.” Journal of Public Economics 28: 59–83.10.1016/0047-2727(85)90020-9Search in Google Scholar

King, R. G., and A. Wolman. 1999. “What Should the Monetary Authority Do When Prices Are Sticky?” In Monetary Policy Rules, edited by J. B. Taylor, 349–404. Chicago, IL: University of Chicago Press.Search in Google Scholar

Kotlikoff, L. J., T. Persson, and L. E. O. Svensson. 1988. “Social Contracts as Assets: A Possible Solution to the Time-Consistency Problem.” American Economic Review 78: 662–677.Search in Google Scholar

Kydland, F. E., and E. C. Prescott. 1977. “Rules Rather than Discretion: The Inconsistency of Optimal Plans.” Journal of Political Economy 85: 473–492.10.1086/260580Search in Google Scholar

Mankiw, N. G., and R. Reis. 2007. “Sticky Information in General Equilibrium.” Journal of the European Economic Association 5: 603–613.10.1162/jeea.2007.5.2-3.603Search in Google Scholar

McCallum, B. T. 1995. “Two Fallacies Concerning Central-Bank Independence.” American Economic Review 85: 207–211.10.3386/w5075Search in Google Scholar

Persson, T., and G. Tabellini. 1993. “Designing Institutions for Monetary Stability.” Carnegie-Rochester Conference Series on Public Policy 39: 53–84.10.1016/0167-2231(93)90003-FSearch in Google Scholar

Persson, T., and G. Tabellini. 1994. Monetary and fiscal policy – Volume I: Credibility. Cambridge, MA: MIT Press.Search in Google Scholar

Phelan, C. 1998. “On the Long Run Implications of Repeated Moral Hazard.” Journal of Economic Theory 79: 174–191.10.1006/jeth.1997.2389Search in Google Scholar

Rogoff, K. 1985. “The Optimal Degree of Commitment to an Intermediate Monetary Target.” Quarterly Journal of Economics 100: 1169–1189.10.2307/1885679Search in Google Scholar

Rogoff, K. 1987. “Reputational Constraints on Monetary Policy.” Carnegie-Rochester Conference Series on Public Policy 26: 141–82.10.1016/0167-2231(87)90024-8Search in Google Scholar

Rotemberg, J. J. 1982. “Monopolistic Price Adjustment and Aggregate Output.” Review of Economic Studies 49: 517–531.10.2307/2297284Search in Google Scholar

Rotemberg, J. J., and M. Woodford. 1999. “Interest Rate Rules in an Estimated Sticky Price Model.” In Monetary Policy Rules, edited by J. B. Taylor, 57–126. Chicago, IL: University of Chicago Press.10.3386/w6618Search in Google Scholar

Sbordone, A. M. 2007. “Inflation Persistence: Alternative Interpretations and Policy Implications.” Journal of Monetary Economics 54: 1311–1339.10.1016/j.jmoneco.2007.06.007Search in Google Scholar

Schorfheide, F. 2008. “DSGE Model-Based Estimation of the New Keynesian Phillips Curve.” Federal Reserve Bank of Richmond Economic Quarterly 94: 397–433.Search in Google Scholar

Sleet, C., and S. Yeltekin. 2005. “Credible Social Insurance.” Working paper, Carnegie Mellon University.10.2139/ssrn.832764Search in Google Scholar

Söderström, U., P. Söderlind, and A. Vredin. 2005. “New-Keynesian Models and Monetary Policy: A Re-Examination of the Stylized Facts.” The Scandinavian Journal of Economics 107: 521–546.10.1111/j.1467-9442.2005.00421.xSearch in Google Scholar

Stokey, N. 1991. “Credible Public Policy.” Journal of Economic Dynamics and Control 15: 367–390.10.1016/0165-1889(91)90036-ZSearch in Google Scholar

Svensson, L. E. O. 1997. “Optimal Inflation Targets, ‘Conservative’ Central Banks, and Linear Inflation Contracts.” American Economic Review 87: 98–114.10.3386/w5251Search in Google Scholar

Svensson, L. E. O., and M. Woodford. 2002. “Indicator Variables for Optimal Policy.” Journal of Monetary Economics 50: 691–720.10.3386/w7953Search in Google Scholar

Svensson, L. E. O., and M. Woodford. 2005. “Implementing Optimal Policy through Inflation-Forecast Targeting.” In The Inflation-Targeting Debate, edited by B. S. Bernanke, and M. Woodford, 19–92. Chicago, IL and London, UK: University of Chicago Press.10.7208/chicago/9780226044736.003.0003Search in Google Scholar

Taylor, J. B. 1979a. “Estimation and Control of a Macroeconomic Model with Rational Expectations.” Econometrica 47: 1267–1286.10.2307/1911962Search in Google Scholar

Taylor, J. B. 1979b. “Staggered Wage Setting in a Macro Model.” American Economic Review 69: 108–113.Search in Google Scholar

Thomas, J., and T. Worrall. 1990. “Income Fluctuation and Asymmetric Information: an Example of a Repeated Principal-Agent Problem.” Journal of Economic Theory 51: 367–390.10.1016/0022-0531(90)90023-DSearch in Google Scholar

Walsh, C. E. 1995. “Optimal Contracts for Central Bankers.” American Economic Review 85: 150–167.Search in Google Scholar

Woodford, M. (1999). CommentaryCommentary: How Should Monetary Policy Be Conducted in an Era of Price Stability, In Proceedings - Economic Policy Symposium - Jackson Hole, Jackson Hole. 277–316.Search in Google Scholar

Woodford, M. 2000. “Pitfalls of Forward-Looking Monetary Policy.” American Economic Review 90: 100–104.10.1257/aer.90.2.100Search in Google Scholar

Woodford, M. 2003. Interest and Prices: Foundations of a Theory of Monetary Policy. Princeton University Press.10.1515/9781400830169Search in Google Scholar