Nonlinear Monetary Policy Rules: Some New Evidence for the U.S


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  • This paper derives optimal monetary policy rules in setups where certainty equivalence does not hold because either central bank preferences are not quadratic, and/or the aggregate supply relation is nonlinear. Analytical results show that these features lead to sign and size asymmetries, and nonlinearities in the policy rule. Reduced-form estimates indicate that US monetary policy can be characterized by a nonlinear policy rule after 1983, but not before 1979. This finding is consistent with the view that the Fed's inflation preferences during the Volcker-Greenspan regime differ considerably from the ones during the Burns-Miller regime.

fecha de publicación

  • 2003

Líneas de investigación

  • Asymmetric Preferences
  • Inflation Targets
  • Monetary
  • Non-linear Philli Curve
  • Non-linear Taylor Rules


  • 2003-24