Orphanides, Athanasios; Williams, John C. - 2003
Inflation Scares and Forecast-Based Monetary Policy
Athanasios Orphanides
Board of Governors of the Federal Reserve … monetary policy. Agents are assumed to
have imperfect knowledge of the precise structure of the economy and the policymakers … for the conduct of e cient monetary policy. Under
rational expectations, inflation expectations equal a linear combination …