Uncertainty is a ubiquitous concern emphasized by policymakers. We study how uncertainty affects decision-making by the … Federal Open Market Committee (FOMC). We distinguish between the notion of Fed-managed uncertainty vis-a-vis uncertainty that …-managed uncertainty introduces a wedge between the standard Taylor-type policy rule and the optimal decision. Using private Fed …

-run concept like the natural rate of unemployment. We examine what effect uncertainty has on the use of NAIRU in policy …. Uncertainty about the level of NAIRU does not imply that monetary policy should react less to the NAIRU gap. However, uncertainty … Brainard (1967), uncertainty about the effect of the monetary policy instrument on the NAIRU gap reduces the magnitude of the …

) cases, these robust policies are more aggressive than the optimal policies absent model uncertainty. The specific robust … policies depend strongly on the formation of model uncertainty used, and we make some suggestions about which formulation is …

). Finally, this class of rules is robust to model uncertainty, in the sense that a first-difference rule taken from the policy … rules are less robust to model uncertainty: rules with additional parameters can be fine-tuned to the dynamics of a …

representation found by Nelson and Plosser (1980) to be consistent with U. S. historical data. The impact of inflation uncertainty on … hypothesis that the initial positive real impact of anticipated money is not temporary. Inflation uncertainty is found to act as …

We study a novel policy tool--interest rate uncertainty--that can be used to discourage inefficient capital inflows and … identify the trade-offs faced in navigating between external balance and price stability. The interest rate uncertainty policy … the world. Under every scenario, uncertainty policy is inflationary …

("uncertainty"), we find that a lax monetary policy decreases both risk aversion and uncertainty, with the former effect being …

dominate, in that public releases increase uncertainty about fundamentals. In some cases, public releases can create or …

We study the design of optimal monetary policy under uncertainty in a dynamic stochastic general equilibrium models. We … use a Markov jump-linear-quadratic (MJLQ) approach to study policy design, approximating the uncertainty by different … a benchmark New Keynesian model, analyzing how policy is affected by uncertainty, and how learning and active …