The apprentice wizard: monetary policy, complexity and learning. (English) Zbl 1111.91330
Summary: This paper investigates some central issues of monetary policy by offering a model in which a central bank tries to stabilize fluctuations in aggregate output and inflation in an adaptive complex economy. We resort to evolutionary algorithms to model the central bank behaviour under discretion, and confront the efficiency of discretion with the choice of full commitment to a fixed rule.
MSC:
| 91B64 | Macroeconomic theory (monetary models, models of taxation) |
Keywords:
Taylor ruleReferences:
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