If structural changes are, for example, affecting the relationships between conventional measures of economic slack and prices, or the economy’s medium-term potential output path, or the relevance of particular economic indicators, then that should be taken into account in setting the instrument. How does one go about that? There is no simple device available for this purpose.
It is essentially a matter of trying to be quick learners - continually being on the look out for things which are different to the past, and not being too wedded to particular empirical representations of the economy. We have to develop some notion of the economy’s behaviour - it’s not good enough to say we know nothing.