Optimal Monetary Policy Rules for Averting Productivity Induced Jobless Recoveries

Although high productivity growth is a primary economic goal across nations, it can lead to short run adjustment problems when it temporarily achieves high levels. This may induce a jobless recovery when labor productivity is high while an economy is experiencing sluggish growth or a recession. This paper creates a framework for empirically modeling these effects. This model is used in the context of an optimal control framework in order to derive policy rules for guiding monetary policy during such episodes.


Issue Date:
2006
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/50147
Published in:
Review of Applied Economics, Volume 02, Number 2
Page range:
159-167
Total Pages:
9
JEL Codes:
E52; E61; E65




 Record created 2017-04-01, last modified 2017-08-18

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