Orphanides, Athanasios; Williams, John C. - Federal Reserve Board (Board of Governors of the … - 2002
This paper investigates the role of imperfect knowledge regarding the structure of the economy on the formation of … poorly when knowledge is imperfect. In particular, policies that fail to maintain tight control over inflation are prone to … presence of imperfect knowledge, policy should respond more aggressively to inflation than under perfect knowledge. …