Christian-Albrechts-Universität Kiel (CAU) >
Department of Economics, Universität Kiel >
Economics Working Papers, Department of Economics, CAU Kiel >
Please use this identifier to cite or link to this item:
| || |
|Title:||Rational expectations models with anticipated shocks and optimal policy: a general solution method and a new Keynesian example |
Winkler, Roland C.
|Issue Date:||2009 |
|Series/Report no.:||Economics working paper / Christian-Albrechts-Universität Kiel, Department of Economics 2009,01|
|Abstract:||The purpose of this paper is to show how to solve linear dynamic rational expectations models with anticipated shocks by using the generalized Schur decomposition method. Furthermore, we determine the optimal unrestricted and restricted policy responses to anticipated shocks. We demonstrate our solution method by means of a micro-founded hybrid New Keynesian model and show that anticipated cost-push shocks entail higher welfare losses than unanticipated shocks of equal size.|
Optimal Monetary Policy
Generalized Schur Decomposition
|Document Type:||Working Paper|
|Appears in Collections:||Economics Working Papers, Department of Economics, CAU Kiel|
Download bibliographical data as:
Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.