Farmer, Roger E. A.; Waggoner, Daniel F.; Zha, Tao - In: American Economic Review 100 (2010) 1, pp. 608-17
Troy Davig and Eric Leeper (2007) have proposed a condition they call the generalized Taylor principle to rule out indeterminate equilibria in a version of the new-Keynesian model where the parameters of the policy rule follow a Markov-switching process. We show that although their condition...
