Optimal policy perturbations
Mostra el registre complet Registre parcial de l'ítem
- dc.contributor.author Barnichon, Régis
- dc.contributor.author Mesters, Geert
- dc.contributor.other Universitat Pompeu Fabra. Departament d'Economia i Empresa
- dc.date.accessioned 2020-05-25T09:27:08Z
- dc.date.available 2020-05-25T09:27:08Z
- dc.date.issued 2020-04-01
- dc.date.modified 2020-05-25T09:26:33Z
- dc.description.abstract Model mis-specification remains a major concern in macroeconomics, and policy makers must often resort to heuristics to decide on policy actions; combining insights from multiple models and relying on judgment calls. Identifying the most appropriate, or optimal, policy in this manner can be challenging however. In this work, we propose a statistic -the Optimal Policy Perturbation (OPP)- to detect "optimization failures" in the policy decision process. The OPP does not rely on any specific underlying economic model, and its computation only requires (i) forecasts for the policy objectives conditional on the policy choice, and (ii) the impulse responses of the policy objectives to shocks to the policy instruments. We illustrate the OPP in the context of US monetary policy decisions. In forty years, we only detect one period with major optimization failures; during 2010-2012 when unconventional policy tools should have been used more intensively.
- dc.format.mimetype application/pdf*
- dc.identifier https://econ-papers.upf.edu/ca/paper.php?id=1716
- dc.identifier.citation
- dc.identifier.uri http://hdl.handle.net/10230/44787
- dc.language.iso eng
- dc.relation.ispartofseries Economics and Business Working Papers Series; 1716
- dc.rights L'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative Commons
- dc.rights.accessRights info:eu-repo/semantics/openAccess
- dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
- dc.subject.keyword macroeconomic stabilization
- dc.subject.keyword optimal policy
- dc.subject.keyword impulse responses
- dc.subject.keyword sufficient statistics
- dc.subject.keyword forecast targeting
- dc.subject.keyword Macroeconomics and International Economics
- dc.title Optimal policy perturbations
- dc.title.alternative
- dc.type info:eu-repo/semantics/workingPaper