Central banks' monetary policy rules being consistent with policy objectives are a fundamental of applied monetary economics. We seek to determine, first, which of the central bank's rules are most in line with the historical data for the US economy and, second, what policy rule would work best...

Which monetary policy rule best fits the historical data? Which rule is most effective to reach the central bank's objectives? Is minimizing a central bank loss equivalent to maximizing households' welfare? Are NGDP growth or level targeting good options, and if so, when? Do they perform better...

The form of bounded rationality characterizing the representative agent is key in the choice of the optimal monetary policy regime. While inflation targeting prevails for myopia that distorts agents' inflation expectations, price level targeting emerges as the optimal policy under myopia...