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Optimality and Taylor Rules

Published online by Cambridge University Press:  26 March 2020

Andrew P. Blake
Andrew P. Blake*
Affiliation:
National Institute of Economic and Social Research
*
e-mail: a.blake@niesr.ac.uk
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Abstract

This paper discusses the role of forecasts in the control of inflation. Much has been made of variations on the so-called Taylor rule for inflation control. Forward-looking Taylor rules are reconciled with optimal control using a class of rules described as error-correcting Taylor rules.

Type
Research Article
Information
National Institute Economic Review , Volume 174 , October 2000 , pp. 80 - 91
Copyright
Copyright © 2000 National Institute of Economic and Social Research

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Footnotes

This article develops some themes and ideas which came about from conversations with Tibor Hledik, to whom I am grateful. I would like to thank Ray Barrell and Martin Weale for useful comments on an earlier draft.

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