The Taylor rule and dynamic stability in a small macroeconomic model

In this paper we embed the Taylor interest rate rule in a simple macroeconomic model with Calvo contracts. We contrast this with the case in which the interest rate is determined by the conventional LM curve along with a fixed value for the monetary aggregate. We derive conditions under which the ad...

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Bibliographic Details
Main Authors: David Chappell, Paul Turner
Format: Default Article
Published: 2003
Subjects:
Other economics not elsewhere classified
inflation
Taylor rule
debt-inflation
Economics not elsewhere classified
Online Access:https://hdl.handle.net/2134/274
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