The Indeterminacy of Determinacy with Fiscal, Macro-prudential or Taylor Rules
Pré-publication, Document de travail: The determinacy of dynamic stochastic general equilibrium models including fiscal, macro-prudential or Taylor rules relies on the assumption that policy instruments are forward-looking when policy targets are also forward-looking. Blanchard and Kahn (1980) determinacy condition does not forbid to assume that policy instruments are backward-looking when policy targets are forward-looking, as it is the case for Ramsey optimal policy under quasi-commitment. There is indeterminacy of determinacy unless six criteria are considered which are in favor of assuming that policy instruments are backward-looking when policy targets are forward-looking.
Mots-clés JEL
Mots-clés
- Determinacy
- Proportional Feedback rules
- Dynamic Stochastic General Equilibrium
- Taylor rule
- Fiscal rule
- Macro-prudential rule
- Optimal control
- Ramsey optimal policy under quasi-commitment
Référence interne
- PSE Working Papers n°2018-45
URL de la notice HAL
Version
- 1