Announcements and Credibility of Monetary Policy.
An infinitely repeated monetary policy game … la Barro and Gordon (1983) is considered. Before the game starts the government announces a policy rule. If there is a slight probability that government is honest and a slight probability that the government makes mistakes, then a sufficiently patient government will have average loss close to its commitment loss in all sequentially rational equilibria of the infinitely repeated game.
Year of publication: |
1996-06
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Authors: | Schultz, Christian |
Institutions: | Economic Policy Research Unit (EPRU), Økonomisk Institut |
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