Optimal Control of the Money Supply
Author(s) -
Robert B. Litterman
Publication year - 1982
Publication title -
monetary economics
Language(s) - English
Resource type - Reports
DOI - 10.3386/w0912
Subject(s) - money supply , economics , control (management) , monetary economics , monetary policy , management
Using optimal control theory and a vector autoregressive representation of the relationship between money and interest rates, one can derive a feedback control procedure which defines the best possible tradeoff between interest rate volatility and money supply fluctuations and which could be used to reduce both from their current levels.
Accelerating Research
Robert Robinson Avenue,
Oxford Science Park, Oxford
OX4 4GP, United Kingdom
Address
John Eccles HouseRobert Robinson Avenue,
Oxford Science Park, Oxford
OX4 4GP, United Kingdom