@techreport{NBERw8785,
 title = "The Fed and the New Economy",
 author = "Laurence Ball and Robert Tchaidze",
 institution = "National Bureau of Economic Research",
 type = "Working Paper",
 series = "Working Paper Series",
 number = "8785",
 year = "2002",
 month = "February",
 URL = "http://www.nber.org/papers/w8785",
 abstract = {This paper seeks to understand the behavior of Greenspan's Federal Reserve in the late 1990s.  Some authors suggest that the Fed followed a simple 'Taylor rule,' while others argue that it deviated from such a rule because it recognized that the 'New Economy' permitted an easing of policy.  We find that a Taylor rule based on inflation and unemployment does break down in the late 1990s.  However, the Fed's behavior appears stable once one accounts for the falling NAIRU of the period.  A rule based on inflation and the deviation of unemployment from the NAIRU captures the Fed's behavior through the entire period from 1987 to 2000.},
}