Shaw, Ming-fu; Chen, Shu-hua; Lai, Ching-chong; Chang, … - Institute of Economics, Academia Sinica - 2004
This paper sets up an endogenous growth model of an open economy in which the monetary authority implements a gradualist interest-rate rule with targets for inflation and economic growth. We show that, under a passive rule, a monetary equilibrium exists and is unique; moreover, the equilibrium is...