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dc.contributor.authorHughes Hallett, Andrew
dc.contributor.authorAcocella, Nicola
dc.date.accessioned2016-05-31T09:30:06Z
dc.date.available2016-05-31T09:30:06Z
dc.date.issued2018-01
dc.identifier242259960
dc.identifier03ca86c3-8d8d-457b-ae54-3a9ad7b0e0c0
dc.identifier84962779322
dc.identifier000428283100007
dc.identifier.citationHughes Hallett , A & Acocella , N 2018 , ' Stabilization and commitment : forward guidance in economies with rational expectations ' , Macroeconomic Dynamics , vol. 22 , no. 1 , pp. 122-134 . https://doi.org/10.1017/S136510051600002Xen
dc.identifier.issn1365-1005
dc.identifier.urihttps://hdl.handle.net/10023/8901
dc.description.abstractWe construct a theory of forward guidance in economic policy making in order to provide a framework for explaining the role and strategic advantages of including forward guidance as an explicit part of policy design. We do this by setting up a general policy problem in which forward guidance plays a role, and then examine the consequences for performance when that guidance is withdrawn. We show that forward guidance provides enhanced controllability and stabilizability—especially where such properties may not otherwise be available. As a by-product, we find that forward guidance limits the scope and incentives for time-inconsistent behavior in an economy whose policy goals are ultimately reachable. It also adds to the credibility of a set of policies.
dc.format.extent13
dc.format.extent478078
dc.language.isoeng
dc.relation.ispartofMacroeconomic Dynamicsen
dc.subjectManaging expectationsen
dc.subjectStabilizabilityen
dc.subjectDynamic controllabilityen
dc.subjectTime consistencyen
dc.subjectHB Economic Theoryen
dc.subjectEconomics and Econometricsen
dc.subjectT-NDASen
dc.subject.lccHBen
dc.titleStabilization and commitment : forward guidance in economies with rational expectationsen
dc.typeJournal articleen
dc.contributor.institutionUniversity of St Andrews. School of Economics and Financeen
dc.identifier.doihttps://doi.org/10.1017/S136510051600002X
dc.description.statusPeer revieweden


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