Does the Crisis Experience Call for a New Paradigm in Monetary Policy?

CASE Network Studies and Analyses Report No. 402 evaluates monetary policy during the financial crisis by dividing the crisis into three stages: pre-panic, panic and post-panic.  Author John B. Taylor explains that the monetary policy paradigm in place before the financial crisis worked very well; the crisis occurred when policy makers deviated from that paradigm and undertook extraordinary measures which fell short of their expectations.  Rather than calling for a new paradigm in monetary policy, John B. Taylor promotes a stricter adherence to the rules already in place.

John B. Taylor is an economist known for his research on the foundations of modern monetary theory and policy, and his experience in international economics.  His research has been applied by central banks and financial market analysts around the world.

John B. Taylor visited Warsaw June 20-23, 2010.  During his visit, he gave presentations at two key events and attended meetings with CASE experts, academia, policy makers, bankers, and economic journalists. 

More information about the visit with links to event videos and presentations can be found here.