RDP 2007-07: More Potent Monetary Policy? Insights from a Threshold Model
Equation (1)
X
t
=
A
1
(
L
)
X
t
−
1
I
[
q
t
−
d
≤
q
^
]
+
A
2
(
L
)
X
t
−
1
I
[
q
t
−
d
>
q
^
]
+
ε
t
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