The Monetary policy rules and the inflation process in open emerging


Autoria(s): Vasicek, Borek
Contribuinte(s)

Universitat Autònoma de Barcelona. Departament d'Economia Aplicada

Data(s)

09/07/2009

Resumo

This paper has three objectives. First, it aims at revealing the logic of interest rate setting pursued by monetary authorities of 12 new EU members. Using estimation of an augmented Taylor rule, we find that this setting was not always consistent with the official monetary policy. Second, we seek to shed light on the inflation process of these countries. To this end, we carry out an estimation of an open economy Philips curve (PC). Our main finding is that inflation rates were not only driven by backward persistency but also held a forward-looking component. Finally, we assess the viability of existing monetary arrangements for price stability. The analysis of the conditional inflation variance obtained from GARCH estimation of PC is used for this purpose. We conclude that inflation targeting is preferable to an exchange rate peg because it allowed decreasing the inflation rate and anchored its volatility.

Formato

39 pages

513965 bytes

application/pdf

Identificador

http://hdl.handle.net/2072/20338

Idioma(s)

eng

Relação

Document de treball (Universitat Autònoma de Barcelona. Departament d'Economia Aplicada); 0903

Direitos

Aquest document està subjecte a una llicència d'ús de Creative Commons, amb la qual es permet copiar, distribuir i comunicar públicament l'obra sempre que se'n citin l'autor original, la universitat i el departament i no se'n faci cap ús comercial ni obra derivada, tal com queda estipulat en la llicència d'ús (http://creativecommons.org/licenses/by-nc-nd/2.5/es/)

Palavras-Chave #Política monetària -- Unió Europea, Països de la #Inflació -- Unió Europea, Països de la
Tipo

info:eu-repo/semantics/workingPaper