# Optimal Policy Rules

**URL:** <https://forum.dynare.org/t/optimal-policy-rules/4578>\
**Category:** Dynare help (legacy posts)\
**Created:** [25 March 2015 21:54 UTC](https://forum.dynare.org/t/optimal-policy-rules/4578 "2015-03-25T21:54:46Z")\
**Posts on this page:** 1\
**Showing post:** 3

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**Author:** ![jpfeifer](https://forum.dynare.org/user_avatar/forum.dynare.org/jpfeifer/32/5044_2.png) [@jpfeifer](https://forum.dynare.org/u/jpfeifer)\
**Post date:** [27 March 2015 08:43 UTC](https://forum.dynare.org/t/optimal-policy-rules/4578/3 "2015-03-27T08:43:36Z")

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For the steadystate-operator question, see [[An infinity of steady states with Taylor rules](https://forum.dynare.org/t/an-infinity-of-steady-states-with-taylor-rules/4026/1))

1. Yes, you can use any objective function you want as long as you find a recursive representation, but you need to go to second order. That allows you implement the conditional variance as e.g.  
(pi(+1)-pi\_ss)^2. If you are interested in the unconditional variance, you can loop over the required parameters to minimize some linear combination in oo\_.var. That is what the osr-command does.
2. Schmitt-Grohé/Uribe (2007): “Optimal simple and implementable monetary and fiscal rules - Expanded Version” is similar. Note that for the osr-command, it is the unconditional variance that is minimized.

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