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Economic Ideas, the Monetary Order and the Uneasy Case for Policy Rules

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The problems posed by monetary policy cannot be dealt with by legislating enduring policy rules. With the passage of time, economic understanding does not systematically converge ever more closely on a “true” model of the economy, a process which is now sufficiently far along that our current ideas can form the basis for designing such measures. Rather, economic ideas evolve unsteadily and unpredictably and disagreement about them is routine. They influence the behaviour of the economy and they are influenced by it as they develop, requiring policy principles to adapt as well. Monetary policy thus poses problems that cannot be solved once and for all, but must be coped with continuously.

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  • David Laidler, 2016. "Economic Ideas, the Monetary Order and the Uneasy Case for Policy Rules," University of Western Ontario, Departmental Research Report Series 20164, University of Western Ontario, Department of Economics.
    • Handle: RePEc:uwo:uwowop:20164
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    More about this item

    Keywords

    Monetary Policy; Rules versus Discretion; Gold Standard; Revolutions in Macroeconomics;
    All these keywords.

    JEL classification:

    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
    • B1 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925
    • B2 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925

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