Optimized coefficients in DSGE models

[ecrgap]

Hi all,

I am calibrating a farily standard DSGE model for optimal monetary policyc analysis. I was wondering whether there is an example where the model is simulated in such a way so that to find the optimized coefficients in the Taylor rule. That is, the policy coefficients that minimize the social welfare function.

Thank you in advance.

[AssiaEzzeroug]

Hi,

the dynare instruction "OSR" (for optimal simple rule) allows you to find the optimal weights of a simple rule but for now you can only use an ad hoc objective function as \Pi_t^2 + Y^2 instead of a microfounded one (social welfare).

Hope this helps

[ecrgap]

Of course it does.
Thank you very much indeed.