De la Croix, David (contributor); … - 2006
deviations of the output gap
ˆYt − ˆYpt . Written in percentage deviation from steady-state, the generalized Taylor rule
is of … rate shock εrt, assumed to
follow a first-order autoregressive process.
The output gap is defined as the difference between … monetary shocks on output is amplified and more persistent than in
other monetary business cycle models. On the whole, this …