Implementing Uncertainty into Monetary Models
The previous chapter has enlightened the notion of uncertainty – which is actually risk – and has given some very common and illustrative examples of the consequences of uncertainty and the implications to monetary policy in general. Especially for the cases of additive, parametric, and data uncertainty, this has been shown. However, this has been done without making use of any kind of macro model, but in a rather simple equation context.
KeywordsInterest Rate Monetary Policy Central Bank Parametric Uncertainty Policy Rule
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