We estimate a monetary policy rule for the US allowing for possible frequency dependence — i.e., allowing the central bank to respond differently to more persistent innovations than to more transitory innovations, in both the unemployment rate and the inflation rate. Our estimation method uses...

We estimate a monetary policy rule for the US allowing for possible frequency dependence - i.e., allowing the central bank to respond differently to more persistent innovations than to more transitory innovations, in both the unemployment rate and the inflation rate. Our estimation method uses...

We consider two approaches to incorporate judgment into DSGE models. First, Bayesian estimation indirectly imposes judgment via priors on model parameters, which are then mapped into a judgmental interest rate decision. Standard priors are shown to be associated with highly unrealistic...

Two approaches are considered to incorporate judgment in DSGE models. First, Bayesian estimation indirectly imposes judgment via priors on model parameters, which are then mapped into a judgmental interest rate decision. Standard priors are shown to be associated with highly unrealistic...

In many recent empirical studies of the Federal Open Market Committee's (FOMC's) interest rate rule, the parameters of the rule are allowed to change over time. However, within this literature, there is no consensus about the nature of the parameter change. Some authors, such as Sims and Zha...

Recent research have provided evidence that backward-looking models fit the data well while purely forward-looking models seem to be inconsistent with data. Consequently, many recent papers in the monetary policy rule literature have used hybrid models, which contain both backward- and...

This paper examines estimated forward-looking interest rate rules as a tool for measuring and forecasting monetary policy. Estimation and forecasting results are presented referring to the U.S. monetary policy. Provided that an accurate set of imputs is used, such simple rules prove very helpful...

This paper uses a job duration model based on linked employeremployee data over the period 1989-1998 with an emphasis on the job mobility of the highly educated. It is shown that the job mobility of all prime age workers is sensitive to pecuniary incentives. However, wages as a whole include...