Descriptores: Charles Taylor; Interculturalidad para Québec; Integración de la inmigración; Pluralismo integrador; Valores comunes; Acomodamientos razonables; Charles Taylor; Interculturalism for Québec; Integration of the immigration; Integrating pluralism; Common values; Reasonable accomodations;
Charles Taylor; Interkulturalität für Québec; Integration der Migranten; Integrativer Pluralismus; Gemeinsame Werte; Vernünftige Vereinbarungen
Resumen: This paper deals with some problems related to the application of monetary policy following
the Taylor Rule in the theoretical context of a “3-equation model”. The first problem arises if the
real interest rate does not affect the equilibrium income level itself –as in the IS curve- but its
rate of growth –as in the dynamic IS that we propose. Secondly, the Taylor Rule is incapable of
reaching the inflation target when the central
bank does not correctly estimate its parameters
(the neutral interest rate and potential income) or these parameters vary. Our objective is to
propose an alternative to the Taylor Rule which overcomes both problems. This alternative has
been called the Tracking Rule, because instead of trying to estimate the neutral interest rate or
the potential output, the central bank “tracks” these values based on the economy’s evolution,
particularly on variations in the inflation and unemployment rates. After justifying the dynamic IS
and explaining the logic of this rule in detail, the paper compares the Tracking Rule with the
Taylor Rule, simulating both of them in the context of different types of shock in the modified
three equation model. The results, measured by a loss function, show that the Tracking Rule is
superior in every single case. It is particularly interesting to evaluate central bank reactions
derived from the two rules when the economy suffers a large contractive shock such as the
current crisis. The results show that, with the same shock, the economy is more likely to fall into
the liquidity trap when the Taylor Rule is applied.
Palabras clave: Monetary Policy, Taylor Rule, Liquidity Trap, Simulations
Resumen: In this article we will show that independence is not enough to impose a given inflation target when the Central Bank is following a Taylor rule, moreover in such a case, the fiscal authority will be able to set a different objective from the one sought by the monetary authority. On the other hand, if the fiscal authority is acting in accordance with a rule in which there is a estimated equilibrium expenditure G* similar to the estimated
real interest rate r* in the Taylor rule, neither the government will be able to establish its inflation target value. In this sense, the type of rule that the economic authorities implement is essential for stabilization purposes. The different periods of implementation in fiscal and monetary policy are taken into account although they did not change the main conclusions.
Descriptores: Burbujas ionosféricas; Ionosfera Ecuatorial; Contenido electrónico total oblicuo; Punto subionosférico; Ionospheric bubbles; Equatorial ionosphere; Slant Total Electron content; Pierce point
