Monetary policy rules and US monetary policy

An inflation-augmented Atesoglu monetary policy rule is introduced. The Atesoglu rule is based on an estimate of the neutral rate of interest of Keynes. Actual Fed monetary policy and policy implied by Atesoglu rules are compared. During the 1994:2-2006:4 period, monetary policy suggested by the inflation-augmented Atesoglu rule is closer to that indicated by the Atesoglu rule rather than the actual Fed monetary policy. Findings reveal that the monetary policy implied by the Atesoglu rules has been less restrictive and less volatile than the actual Fed monetary policy.