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The Rules-Discretion Cycle in Monetary and Fiscal Policy

John B. Taylor

Finnish Economic Papers2011article
ABDC B
Weight
0.48

Abstract

This lecture starts with a review of historical trends in the balance between rules and discretion: first toward more discretionary policies in the 1960s and 1970s; second toward more rules-based policies in the 1980s and 1990s; and third back again toward discretion in recent years. In each of these swings, monetary policy and fiscal policy moved in the same direction. These swings are correlated with economic performance—unemployment, inflation, economic and financial stability, the frequency and depths of recessions, the length and strength of recoveries. The lecture then provides evidence that the correlation is causal with the moves toward more rules-based policies improving economic performance.

6 citations

Cite this paper

@article{john2011,
  title        = {{The Rules-Discretion Cycle in Monetary and Fiscal Policy}},
  author       = {John B. Taylor},
  journal      = {Finnish Economic Papers},
  year         = {2011},
}

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The Rules-Discretion Cycle in Monetary and Fiscal Policy

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Evidence weight

0.48

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.42 × 0.4 = 0.17
M · momentum0.60 × 0.15 = 0.09
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.