Indicator variables for optimal policy u
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Lars E.O. Svensson; Michael Woodford
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Article
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2004
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Elsevier Science
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English
β 402 KB
The optimal weights on indicators in models with partial information about the state of the economy and forward-looking variables are derived and interpreted, both for equilibria under discretion and under commitment. The private sector is assumed to have more information than the policymaker. Certa