Leitemo, Kai; Lonning, Ingunn - In: Journal of Money, Credit and Banking 38 (2006) 6, pp. 1619-1640
Several research contributions have argued that information about the output gap is essential for a good monetary policy rule. However, as pointed out by Orphanides (2001), there is considerable real-time uncertainty about the size of the output gap. The paper argues that simple monetary policy...