A rule that suggests appropriate adjustments to interest rates, based on various economic factors such as inflation and employment rate. The rule indicates that if inflation or employment rates are higher than desired, interest rates should be increased in response to these conditions, and the opposite action should be taken under the opposite conditions. The Federal Reserve Board seems to take this rule under consideration, but does not always follow its suggestions when adjusting the interest rate. This rule was developed by John Taylor, a 20th century economist.
Related information about Taylor Rule:
- Taylor rule - Wikipedia, the free encyclopedia
In economics, a Taylor rule is a monetary-policy rule that stipulates how much the central bank should change the nominal interest rate in response to changes ...
- Taylor Rule - The Federal Reserve Bank of San Francisco
Taylor's rule is a formula developed by Stanford economist John Taylor. It was designed to provide "recommendations" for how a central bank like the Federal ...
- Taylor's Rule Definition | Investopedia
A guideline for interest rate manipulation. It was introduced by Stanford economist John Taylor in order to set and adjust prudent rates that will stabilize the ...
- Taylor Rules - Board of Governors of the Federal Reserve System
The result was what became known as the classic Taylor rule: i =2+ π +. 1. 2 ... replacement of the “LM curve” with a Taylor rule in treatments of the Hicksian IS- ...
- Economics One: The Taylor Rule Does Not Say Minus Six Percent
Sep 1, 2010 ... This number is nowhere near -6 percent, which is what you sometimes hear people say the Taylor rule implies. If you think that 1 percent is a ...
- The Taylor Rule And The "Bond Bubble" (Wonkish) - NYTimes.com
Aug 22, 2010 ... What we need, first of all, is a Taylor rule. I decided to use the simplified Mankiw rule, which puts the same coefficient on core CPI inflation and ...
- Discretion versus Policy Rules in Practice - Stanford University
y . Carnegie-Rochester Conference Series on Public Policy 39 (1993) 195-214. North-Holland ' p '. Discretion versus policy rules in practice ~ ' '. John B. Taylor* ...
- Taylor's Rule versus Taylor Rules - University of Houston
Sep 18, 2012 ... Abstract. Does the Taylor rule prescribe negative interest rates for 2009-2011? ... We conclude that the Taylor rule does not provide a rationale ...