Optimal monetary policy with a nonlinear Phillips curve

Authors
Nobay, AR Peel, DA
Citation
Ar. Nobay et Da. Peel, Optimal monetary policy with a nonlinear Phillips curve, ECON LETT, 67(2), 2000, pp. 159-164
Citations number
16
Categorie Soggetti
Economics
Journal title
ECONOMICS LETTERS
ISSN journal
01651765 → ACNP
Volume
67
Issue
2
Year of publication
2000
Pages
159 - 164
Database
ISI
SICI code
0165-1765(200005)67:2<159:OMPWAN>2.0.ZU;2-J
Abstract
The analysis of optimal discretionary monetary policy under a non-linear Ph illips curve is shown to yield results that are in marked contrast to conve ntional results that are drawn from the linear paradigm. Specifically, we s how that there exists a deflation bias in expected output, while the inflat ion bias cannot be signed. Preference uncertainty, however, adds to expecte d inflation. (C) 2000 Elsevier Science S.A. All rights reserved. JEL classi fication: E3; E5.