put nominal rigidities and market imperfections centre stage. however, since these debates more or less concentrated on the shortcomings of the original synthesis, it did not really fundamentally leave the old paradigm. the basic macroeconomic framework of inflation determination has its analogue in the prominence of monetary policy rules. in that context it is argued that monetary policy can roughly be tracked by so called “ simple feedback policies ” such as the “ taylor rule ”. some central banks appear to follow those rules. 7 some macroeconomists even claim that solely relying on those “ simple feedback policies ” might be sufficient if not superior. the latter statement draws on the fact that such simple rules entail lower information requirements than complex rules. however, the plausible tracking of observed monetary policy by a monetary policy reaction function does not imply that the monetary policy strategy is reducible to a simple rule. for instance, even if a mervyn king emphasized that argument vividly. see king, mervyn ( 2004 ), what fates impose : facing up to uncercainty, the eight british academy annual lecture, december 1, 2004. eigene ubersetzung von : „ gefahr entsteht, wenn der mensch sich seiner position sicher fuhlt. “ kohn, donald l. ( 2005 ), modelling inflation : a policymaker ’ s perspective, speech to the international research forum on monetary policy conferences in frankfurt am main, may 20, 2005. see bernanke, ben s. ( 2004 ), the logic of monetary policy, speech before the national economists club, washington, d. c., december 2, 2004. central bank has no output goal, it is likely to react to variations in the output gap as a possible determinant of future inflation. moreover, “ simple feedback policies ” are not necessarily only backward - looking. they can also incorporate forward - looking elements. 8 indeed, they must to some extent be forward - looking. hence, forward - looking approaches or forecast - based policies are and should be relevant to central banks. in this context let me stress two aspects which have been discussed at this conference : our limited knowledge about the expectation formation process and the problem of limited information and limited credibility in financial markets. i should like to discuss expectation formation first. the traditional assumption of rational expectation formation aims at bringing intellectual discipline into our thinking rather than being intended to be an adequate description of the real world. we know that simpl

). number of business insolvencies down 6. 6 % in 2017 year on year, press release 91, march 2018. wiesbaden. financial stability board – fsb ( 2011 ). key attributes of effective resolution regimes for financial institutions, october 2011. basel. financial stability board ( 2017 ). framework for post - implementation evaluation of the effects of the g20 financial regulatory reforms. basel. foster, l., cheryl grim, john c. haltiwanger, and zoltan wolf ( 2018 ). innovation, productivity dispersion, and productivity growth, nber working paper 24420, national bureau of economic research ( nber ). cambridge, ma. international monetary fund – imf ( 2017 ), world economic outlook database, october 2017. washington dc. international monetary fund – imf ( 2018 ), world economic outlook update, january 2018. washington dc. pellegrino, giovanni ( 2017 ). uncertainty and the real effects of monetary policy shocks in the euro area, melbourne institute working paper no 15 / 17, june 2017. melbourne. rajan, raghuram g., and luigi zingales ( 2003 ). the great reversals : the politics of financial development in the twentieth century. journal of financial economics 69 ( 1 ) : 5 – 50. rajan, raghuram g., and rodney ramcharan ( 2016 ). constituencies and legislation : the fight over the mcfadden act of 1927. management science 62 ( 7 ) : 1843 – 1859. 1 for example, empirical results for the us show that monetary policy shocks affect output and investment more strongly in times of low financial market volatility than during spells of heightened volatility ( eickmeier, metiu, and prieto 2016 ). similar results were found for the euro area ( pellegrino 2017 ). 2 these numbers are based on data from the federal statistical office of germany available at www. destatis. de / en / factsfigures / indicators / longtermseries / insolvencies / lrins01. html. 3 these numbers are based on data from the bundesbank ’ s mfi interest rate statistics and calculated as a share of domestic banks'credit volume with a respective fixed interest rate of the total volume ( measured by the 5 / 6 bis central bankers'speeches volume of new business ). the time series is part of the system of indicators for the german residential