Most studies of optimal monetary policy under learning rely on optimality conditions derived for the case when agents …, and makes active use of, the learning algorithm agents follow in forming their expectations. In this setup, monetary … policy can influence future expectations through its e ect on learning dynamics, introducing an additional tradeo between …

We derive the optimal monetary policy in a sticky price model when private agents follow adaptive learning. We show … order to facilitate private sector learning and thus ease the future intratemporal inflation-output gap trade-offs. The … policy recommendation is robust: the welfare loss entailed by the optimal policy under learning if the private sector …

agents have perfectly rational expectations, is unstable if in fact these agents follow standard adaptive learning rules … rule. These strong results extend to the case in which there is simultaneous learning by the policy maker and the private …

agents have perfectly rational expectations, is unstable if in fact these agents follow standard adaptive learning rules … rule. These strong results extend to the case in which there is simultaneous learning by the policy maker and the private …

We derive the optimal monetary policy in a sticky price model when private agents follow adaptive learning. We show … order to facilitate private sector learning and thus ease the future intratemporal inflation-output gap trade-offs. The … policy recommendation is robust: the welfare loss entailed by the optimal policy under learning if the private sector …

We derive the optimal monetary policy in a sticky price model when private agents follow adaptive learning. We show … order to facilitate private sector learning and thus ease the future intratemporal inflation-output gap trade-offs. The … policy recommendation is robust: the welfare loss entailed by the optimal policy under learning if the private sector …

This chapter investigates the implications of adaptive learning in the private sector's formation of inflation … expectations for the conduct of monetary policy. We first review the literature that studies the implications of adaptive learning … expectations are formed in line with adaptive learning. …

This paper develops an adaptive learning formulation of an extension to the Ball, Mankiw, and Reis (2005) sticky …'s preferences for price vs. output stability, the learning process can converge to a new equilibrium in which both output and price …

losses are outweighed by short term gains from the learning phase. …

We study the impact of adaptive learning for the design of a robust monetary policy using a small open-economy New … with model misspecification. Learning induces an intertemporal trade-off for the central bank, i.e., stabilizing inflation … possibility to conduct robust monetary policy is limited in a small open economy under learning for any exchange rate pass …