Komura, Chikara2009-12-072009-12-071986-01Komura, C., (1986), "Optimal Choice of Monetary Policy Instruments: An Optimal Control Simulation With Var for Japan", Discussion Paper No. 227, Center for Economic Research, Department of Economics, University of Minnesota.https://hdl.handle.net/11299/55497The paper analyzes the effective method of monetary control by estimating a vector autoregressive model of three variables, GNP, money supply, and short-term interest rates, and conducting dynamic optimal control simulation for Japan. The result indicates that active monetary control with any monetary policy instruments is better than passive monetary control which keeps certain monetary instruments constant. Among active monetary policy, money supply control turns out to be better than interest rate control. Yet, it appears to be more feasible to follow active interest rate control.en-USWorking Paper