RE-EXAMINING THE IMPLICATIONS OF THE NEW CONSENSUS: ENDOGENOUS MONEY AND TAYLOR RULES IN A SIMPLE NEOCLASSICAL MACRO MODEL

Docherty, P

RE-EXAMINING THE IMPLICATIONS OF THE NEW CONSENSUS: ENDOGENOUS MONEY AND TAYLOR RULES IN A SIMPLE NEOCLASSICAL MACRO MODEL

Docherty, P

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Publication Type:: Journal Article
Citation:: Metroeconomica, 2009, 60 (3), pp. 495 - 524
Issue Date:: 2009-01-01

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Field	Value	Language
dc.contributor.author	Docherty, P https://orcid.org/0000-0002-9975-6435	en_US
dc.date.issued	2009-01-01	en_US
dc.identifier.citation	Metroeconomica, 2009, 60 (3), pp. 495 - 524	en_US
dc.identifier.issn	0026-1386	en_US
dc.identifier.uri	http://hdl.handle.net/10453/9987
dc.description.abstract	This paper re-examines the impact of endogenous money in a neoclassical model with interest-sensitive expenditures. It first outlines a benchmark model with exogenous money and the usual full employment and money growth-determined inflation results. It then replaces exogenous money with endogenous money, which is shown to generate model indeterminacy. Two methods of resolving this indeterminacy are then explored: money illusion and a Taylor rule for monetary policy, a key feature of new consensus models. The paper concludes that endogenous money has negative implications for the behaviour and interpretation of neoclassical and new consensus models. © 2008 Blackwell Publishing Ltd.	en_US
dc.relation.ispartof	Metroeconomica	en_US
dc.relation.isbasedon	10.1111/j.1467-999X.2008.00348.x	en_US
dc.title	RE-EXAMINING THE IMPLICATIONS OF THE NEW CONSENSUS: ENDOGENOUS MONEY AND TAYLOR RULES IN A SIMPLE NEOCLASSICAL MACRO MODEL	en_US
dc.type	Journal Article
utslib.citation.volume	3	en_US
utslib.citation.volume	60	en_US
utslib.for	140102 Macroeconomic Theory	en_US
utslib.for	14 Economics	en_US
pubs.embargo.period	Not known	en_US
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/Faculty of Business
pubs.organisational-group	/University of Technology Sydney/Faculty of Business/Economics Discipline
utslib.copyright.status	closed_access
pubs.issue	3	en_US
pubs.publication-status	Published	en_US
pubs.volume	60	en_US

Abstract:

This paper re-examines the impact of endogenous money in a neoclassical model with interest-sensitive expenditures. It first outlines a benchmark model with exogenous money and the usual full employment and money growth-determined inflation results. It then replaces exogenous money with endogenous money, which is shown to generate model indeterminacy. Two methods of resolving this indeterminacy are then explored: money illusion and a Taylor rule for monetary policy, a key feature of new consensus models. The paper concludes that endogenous money has negative implications for the behaviour and interpretation of neoclassical and new consensus models. © 2008 Blackwell Publishing Ltd.

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http://hdl.handle.net/10453/9987