John Taylor's Contributions to Monetary Theory and Policy
Federal Reserve Bank of Dallas
October 12–13, 2007

Organizers: Lawrence Christiano, Northwestern University Evan F. Koenig, Federal Reserve Bank of Dallas Robert Leeson, Hoover Institution and Stanford University Andrew Levin, Federal Reserve Board

John Taylor has had an enormous impact on how we think about monetary policy and the channels through which it affects the economy. His notion of a trade-off between the variability of inflation and of output (the Taylor Curve), his approach to modeling nominal rigidities (Taylor contracts), and his characterization of how policy has been and ought to be conducted (the Taylor Rule and associated Taylor Principle) have each had an influence that has proven to be enduring and pervasive. These and other contributions are the subject of a conference that will be hosted by the Federal Reserve Bank of Dallas on Friday and Saturday, October 12 and 13, 2007.

Attendance is by invitation only.

Participants include:

Ben S. Bernanke Federal Reserve Board		Bennett T. McCallum Carnegie-Mellon University
James Bullard Federal Reserve Bank of St. Louis		Edward Nelson Federal Reserve Bank of St. Louis
Lawrence Christiano Northwestern University		Guillermo Ortiz Bank of Mexico
Richard H. Clarida Columbia University		David Papell University of Houston
Martin Eichenbaum Northwestern University		Monika Piazzesi University of Chicago
Richard W. Fisher Federal Reserve Bank of Dallas		Julio J. Rotemberg Harvard Business School
Mark Gertler New York University		Glenn Rudebusch Federal Reserve Bank of San Francisco
Luca Guerrieri Federal Reserve Board		Christopher A. Sims Princeton University
Robert E. Hall Stanford University		Frank Smets European Central Bank
Otmar Issing Center for Financial Studies		John B. Taylor Hoover Institution and Stanford University
Donald L. Kohn Federal Reserve Board		Volker Wieland Goethe University of Frankfurt
Robert Leeson Hoover Institution and Stanford University		John Williams Federal Reserve Bank of San Francisco
Andrew Levin Federal Reserve Board		Alexander L. Wolman Federal Reserve Bank of Richmond
John Lipsky International Monetary Fund		Michael Woodford Columbia University
Prakash Loungani International Monetary Fund		Janet Yellen Federal Reserve Bank of San Francisco
Robert E. Lucas Jr. University of Chicago

About the Speakers

Agenda

Friday, October 12

7.30 a.m.		Breakfast
8:10 a.m.		Opening Remarks Fed Chairman Ben S. Bernanke (videoconference)
8:25 a.m.		Welcome President Richard W. Fisher
8:30 a.m.		Looking Back: Historical Perspective on Policy Rules
		Monetary Policy Rules from Adam Smith to Taylor Francesco Asso, George Kahn and Robert Leeson
		Friedman and Taylor on Monetary Policy Rules: A Comparison Presentation Commentator: Edward Nelson
9:15 a.m.		Staggered Wage/Price Setting and Nominal Rigidities
		Two Versions of John Taylor's Model of Nominal Price Adjustments Presentation Bennett T. McCallum
		New Micro Evidence on Price Rigidities Presentation Martin Eichenbaum, Nir Jaimovich and Sergio Rebelo
		Presentation Commentator: Frank Smets
10:45 a.m.		Break
11:00 a.m.		The Design of Monetary Policy
		Optimal Monetary Policy in a Model with Distinct Core and Headline Inflation Rates Presentation Martin Bodenstein, Chris Erceg and Luca Guerrieri
		Macroeconometric Equivalence, Microeconomic Dissonance, and the Design of Monetary Policy Andrew Levin, Edward Nelson, David López-Salido and Tack Yun
		Presentation Commentator: Mark Gertler
12:30 p.m.		Lunch
		Remarks by Robert E. Lucas Jr.
1:45 p.m.		Globalization and Monetary Policy
		Reflections on Monetary Policy Choices in the Open Economy: Implications from an Optimizing Model Presentation Richard Clarida
		Worldwide Macroeconomic Stability and Monetary Policy Rules Presentation James Bullard and Aarti Singh
		Presentation Commentator: Prakash Loungani
3:15 p.m.		Break
3:30 p.m.		Policy Rules and Financial Markets
		Examining the Bond Premium Puzzle with a DSGE Model Presentation Glenn Rudebusch and Eric Swanson
		Taylor Rules with Real-Time Data: A Tale of Two Countries and One Exchange Rate Presentation Tanya Molodtsova, Alex Nikolsko Rzhevskyy and David Papell
		Commentator: Monika Piazzesi
5:00 p.m.		Policy Roundtable
		Rules and Discretion Lawrence Christiano
		John Taylor and the Theory and Practice of Central Banking – Some Reflections Otmar Issing
		Guillermo Ortiz
		Policymakers Roundtable Janet Yellen
		Moderator: Richard W. Fisher
6:30 p.m.		Reception
7:00 p.m.		Dinner
		John Taylor Rules Remarks by Fed Vice Chairman Donald L. Kohn

Saturday, October 13

8:00 a.m.		Breakfast
8:30 a.m.		Learning and Uncertainty
		Central Bank Misperceptions and the Role of Money in Interest-Rate Rules Presentation Guenter W. Beck and Volker Wieland
		Learning, Expectations Formation, and the Pitfalls of Optimal Control Monetary Policy Presentation Athanasios Orphanides and John Williams
		Fiscal and Monetary Policy Interactions Presentation Christopher A. Sims
10:15 a.m.		Break
10:30 a.m.		Wage and Price Contracts and Bargaining
		Equilibrium Sticky Prices Presentation Robert E. Hall
		Minimally Altruistic Wages and Unemployment in a Matching Model Presentation Julio J. Rotemberg
		Presentation Commentator: Alexander L. Wolman
Noon		Looking Ahead
		Forecast Targeting as a Monetary Policy Strategy: Policy Rules in Practice Michael Woodford
		The Dual Nature of Forecast Targeting and Instrument Rules: A Comment on Michael Woodford’s “Forecast Targeting as a Monetary Policy Strategy: Policy Rules in Practice” Presentation Commentator: John B. Taylor
12:45 p.m.		Lunch and Adjourn
		Remarks by John Lipsky