Resource title

Solution of RE Models with Anticipated Shocks and Optimal Policy

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Resource description

The purpose of this paper is to solve linear dynamic rational expectations models with anticipated shocks by using the generalized Schur decomposition method. We also determine the optimal unrestricted and restricted policy responses to temporary as well as permanent shocks which both are anticipated by the public. In particular, our method is useful for the analysis of optimal monetary policy in New Keynesian dynamic general equilibrium models.

Resource author

Hans-Werner Wohltmann, Roland C. Winkler

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Resource language

eng

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text/html

Resource resource URL

http://hdl.handle.net/10419/22048

Resource license

Adapt according to the presented license agreement and reference the original author.