Activities per year
Abstract
Using the Reserve Bank of Australia's MARTIN model, we compare actual monetary policy decisions with a counterfactual in which the cash rate is set according to an optimal simple rule. We find that monetary policy played a crucial role in avoiding a potential recession in 2001 and mitigating the downturn in 2008–09. By contrast we find that the cash rate was too high during 2016–19, keeping inflation below the Reserve Bank's target band. Optimal monetary policy in 2016–19 would have involved a substantially lower cash rate and produced significantly better employment outcomes.
Original language | English |
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Pages (from-to) | 271-295 |
Number of pages | 25 |
Journal | Economic Record |
Volume | 98 |
Issue number | 322 |
DOIs | |
Publication status | Published - Sep 2022 |
Activities
- 2 Submissions to industry or govt committees, commissions and inquiries
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Submission to Review of the Reserve Bank of Australia
Isaac Gross (Fellow)
31 Oct 2022Activity: External Academic Engagement › Submissions to industry or govt committees, commissions and inquiries
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Briefings for Standing Committee on Economics
Isaac Gross (Fellow)
5 Feb 2019 → 12 Aug 2022Activity: External Academic Engagement › Submissions to industry or govt committees, commissions and inquiries