<p>The Taylor rule links the interest rate to other variables (usually inflation), which are determined by the model (hence, endogenous). Therfore, it is endogenous. </p>

<p>Similarly government expenditure. If it is pinned down (partially) by factors determined in the model, it is endogenous. </p>

CC BY-SA 3.0
2017-01-24T22:10:12.007Z
2017-01-24T22:10:12.007Z
Chris tie
<p>interest rate in Talor rule is considered as endogenous or exogenous? Similarly there are some fiscal policy rules in assuming fiscal instrumens like government expenditure and distortionary taxes  react to debt and GDP. While specifying this in DSGE government expenditure and taxes are considered as endogenous or exogenous?</p>

CC BY-SA 3.0
2017-01-23T16:27:45.033Z
Please post separate questions as separate questions. Also adding more details would not hurt.
Giskard
<macroeconomics><new-keynesian-economics>
New-Keynesian-Economics
tehseen
# New-Keynesian-Economics

(Asked by: username_0 on 2017-01-23)

interest rate in Talor rule is considered as endogenous or exogenous? Similarly there are some fiscal policy rules in assuming fiscal instrumens like government expenditure and distortionary taxes react to debt and GDP. While specifying this in DSGE government expenditure and taxes are considered as endogenous or exogenous?

**Tags:** macroeconomics, new-keynesian-economics

> **Comments:**
> **username_1**: Please post separate questions as separate questions. Also adding more details would not hurt.  

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## 1 answers

### Answer by username_2 on 2017-01-24. Score: 0

The Taylor rule links the interest rate to other variables (usually inflation), which are determined by the model (hence, endogenous). Therfore, it is endogenous.

Similarly government expenditure. If it is pinned down (partially) by factors determined in the model, it is endogenous.


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