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The form of bounded rationality characterizing the representative agent is key in the choice of the optimal monetary policy regime. While inflation targeting pr

It is widely recognised that the market and the monetary authorities face a high degree of uncertainty about the appropriate models to use for policy decisions

This paper presents a framework for analyzing how bounded rationality affects monetary and fiscal policy. The model is a tractable and parsimonious enrichment o

Froyen and Guender have provided a thorough and careful analysis of optimal monetary policy over most of the range of theoretical models that have been used in