Title

Monetary Policy Models

Author(s)

Christopher A. Sims Christopher Sims (Princeton University)

Abstract

I have written several papers for BPEA (2002; 1996; 1982) looking at the relation of multiple equation quantitative economic models to the process of monetary policy making. When the first of these papers was written, the impact of the rational expectations critique in undermining academic interest in quantitative modeling for monetary policy was apparent. Many, maybe most, economists took the Lucas critique to imply that the month-to-month business of choosing monetary policy actions in the light of current information was trivial or irrelevant. Economists were thought to have nothing useful to say about it. Economists were supposed to contemplate only the choice of policy rules, which were modeled as functions mapping the state of the economy into policy actions.

Creation Date

2007-11

Section URL ID

CEPS

Paper Number

155

URL

https://gceps.princeton.edu/wp-content/uploads/2017/01/155sims.pdf

File Function

Jel

E52; E58

Keyword(s)

monetary policy

Suppress

false

Series

3