Damjanovic, Tatiana; Damjanovic, Vladislav; Nolan, Charles - In: International Journal of Central Banking 11 (2015) 1, pp. 103-149
The unconditional expectation of social welfare is often used to assess alternative macroeconomic policy rules in applied quantitative research. This paper provides a detailed analysis of such policies. It sets out the unconditionally optimal (UO) policy problem and derives a linear-quadratic...