Paper #1057

Títol:

Constant interest rate projections without the curse of indeterminacy

Autor:

Jordi Galí

Data:

Agost 2007 (Revisió: Febrer 2008)

Resum:

Constant interest rate (CIR) projections are often criticized on the grounds that they are inconsistent with the existence of a unique equilibrium in a variety of forward-looking models. This note shows how to construct CIR projections that are not subject to that criticism, using a standard New Keynesian model as a reference framework.

Paraules clau:

Interest rate peg, in.ation targeting, conditional forecasts, interest rate rules, multiple equilibria

Codis JEL:

E37, E58

Àrea de Recerca:

Macroeconomia i Economia Internacional

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