Journal of Political Economy Vol. 90 No. 1 1982
Does Anticipated Monetary Policy Matter? An Econometric Investigation
Abstract
A heated debate has arisen over the policy ineffectiveness proposition associate with the work of Lucas, Sargent, and Wallace. It postulates that anticipated aggregate demand policy will have no effect on business-cycle fluctuations, so that one deterministic, feedback policy rule is as good as any other from the point of view of stabilizing the economy. This paper develops a methodology for empirically analyzing rational-expectations models displaying this neutrality result and then applies it to the important question of whether anticipated monetary policy matters to the business cycle.
- DOI
- 10.1086/261038
- Volume
- 90
- Issue
- 1
- Pages
- 22-51
- Language
- en
- Sources
- crossref openalex