A Simple Bayesian Framework and Simulation？A Simple Bayesian Framework and Simulation
Abstract: Policy designer adjust data, model or policy rule to achieve some policy object, but may consider too little about uncertainties in implementation in future. We summarize the major contents of policy design and provide a Bayesian framkework for analysing it. We show it is optimal for a policy not adjusting data with small prior variance and stabilizing rule in a simulation case resemblying GDP growth. The implication is that it should be careful to design optimal policy among options of adjustment of data, model, and policy rules.