Quantitative Evaluation of Stabilization Policies

September 23 and 24, 2005
A conference sponsored jointly by the Federal Reserve Bank of New York, the Program for Economic Research at Columbia University, and the Dynare Project of CEPREMAP (Centre pour la recherche économique et ses applications).

Overview
The goal of this conference is to present and discuss recent developments in the use of quantitative structural models to simulate and evaluate alternative monetary and fiscal policies. The conference emphasizes models with optimizing foundations that are parameterized to match features of economic time series. Examples of the issues that we address include methods of econometric estimation and tests of the empirical fit of dynamic stochastic general equilibrium models, ways of taking into account parameter and model uncertainty in policy evaluation exercises, the welfare consequences of stabilization policies, and the degree to which simple rules can approximate a fully optimal policy. The conference considers analyses of stabilization policy in both closed and open economies.

Conference Location
Italian Academy for Advanced Studies in America OFFSITE
Columbia University
1161 Amsterdam Avenue
New York, NY 10027

Conference Organizers
Prof. Michael Woodford, Columbia University
Michael.Woodford@columbia.edu

Dr. Paolo Pesenti, Federal Reserve Bank of New York
Paolo.Pesenti@ny.frb.org

Prof. Michel Juillard, CEPREMAP
Michel.Juillard@ens.fr

Registration

The conference is by invitation only. Invited participants are requested to complete the registration form and fax it to Elizabeth Lewis-Draffen, +1 212 720 6831 or email it to christopher.tonetti@ny.frb.org no later than August 15, 2005. Confirmation of registration will be sent by email to all participants.

Preliminary Program
Friday, September 23

8:30 a.m. Continental Breakfast

SESSION 1: Modeling Monetary Economies

Chair: Michael Woodford (Columbia University)

9:00 a.m. Fiscal Determination of Hyperinflation

Thomas Sargent (New York University and Hoover Institution), Noah Williams (Princeton University), and Tao Zha (Federal Reserve Bank of Atlanta)

Discussant: Christopher Sims (Princeton University)

10:10 a.m. Morning Break

10:30 a.m. Monetary Policy Analysis with Potentially Misspecified ModelsOFFSITE

Marco Del Negro (Federal Reserve Bank of Atlanta) and Frank Schorfheide (University of Pennsylvania)

Discussant: Andrew Levin (Federal Reserve Board)

11:40 a.m. An Estimated DSGE Model of the US Economy

Rochelle Edge , Michael Kiley , and Jean-Philippe Laforte (Federal Reserve Board)

Discussant: Argia Sbordone (Federal Reserve Bank of New York)

1:00 p.m. Lunch

SESSION 2: Policy Evaluation in Open Economies

Chair: Paolo Pesenti (Federal Reserve Bank of New York)

2:30 p.m. Empirical Properties of Closed and Open Economy DSGE Models of the Euro Area

Malin Adolfson (Sveriges Riksbank), Stefan Laséen (Sveriges Riksbank), Jesper Lindé (IIES and Sveriges Riksbank), and Mattias Villani (Sveriges Riksbank and Stockholm University)

Discussant: Günter Coenen
(European Central Bank)

3:40 p.m. Welfare Effects of Tax Policy in Open Economies: Stabilization and Cooperation

Jinill Kim (Federal Reserve Board) and Sunghyun Henry Kim (Tufts University)

Discussant: Roland Straub (International Monetary Fund)

4:50 p.m. Adjourn

7:00 p.m. Dinner (by invitation only) Saturday, September 24

8:30 a.m. Continental Breakfast

SESSION 3: Optimal monetary policy

Chair: Michel Juillard (CEPREMAP)

9:00 a.m. Monetary Policy Rules in Economies with Traded and Non-Traded Goods

Brian M. Doyle , Christopher J. Erceg , and Andrew T. Levin (Federal Reserve Board)

Discussant: Ester Faia (Universitat Pompeu Fabra)

10:10 a.m. Morning Break

10:30 a.m. Linear-Quadratic Approximation to Optimal Policy: An Algorithm and Two Applications

Filippo Altissimo (European Central Bank), Vasco Cúrdia (Princeton University) and Diego Rodriguez Palenzuela (European Central Bank)

Discussant: Jinill Kim (Federal Reserve Board)

11:40 a.m. Panel on "The role of quantitative models in policymaking"

Speakers: Jarle Bergo (Norges Bank), Spencer Dale (Bank of England), Marvin Goodfriend (Carnegie Mellon University), and Douglas Laxton (International Monetary Fund)

1:00 p.m. Lunch (informal)

2:00 p.m. Adjourn