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Models of Policy under Stochastic Replanning

Staff Report 104 | Published March 1, 1986

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Models of Policy under Stochastic Replanning


This paper considers a policy environment in which policy is not set by a single policymaker, but by a sequence of policymaking administrations. Administration turnover is determined by a simple random process. The consequences of administration turnover are traced through for two versions of a linear rational expectations model, and numerical simulations of various policy environments are presented.

Published in: _International Economic Review_ (Vol. 28, No. 3, October 1987, pp. 731-755)