Evans, George W. (contributor); … - 2008
conducted using variants of the Taylor rule.
These rules work well only under certain parameter restrictions, and Bullard
and … the output
gap is zero. (Recall that i
t
is specified net of the real interest rate, which in
the standard Taylor rule is …
where χ
π
,χ
x
> 0. (4)
Variations of the Taylor rule replaceπ
t
andx
t
by lagged values or by forecasts
of current or …