How the European Central Bank decided its early monetary policy

Abstract: The main goal in this paper is to detect the mechanisms that should rationally stimulate the decision making-policies of the European Central Bank. This is carried out under the framework of theoretical principles of interest rate rules. Firstly, we deduce a set of logically advisable guidelines for the strategy actually developed by this central bank. Then, we contrast a wide set of hypotheses with reference to those variables the ECB take into account on deciding its monetary policy, with a flexible treatment regarding the number of months of advance or delay in the explanatory variables. The results lead us to the conclusion that the ECB, besides adopting a smooth strategy, especially bears in mind the expected core inflation rate, with a reaction coefficient adjusted to that initially proposed by Taylor. The economic growth rate, though it has a significant positive coefficient, matters relatively little and is backward looking. Finally, we evaluate up to what point the behavio

Standort
Deutsche Nationalbibliothek Frankfurt am Main
Umfang
Online-Ressource
Sprache
Englisch
Anmerkungen
Postprint
begutachtet (peer reviewed)
In: Applied Economics ; 39 (2007) 7 ; 927-936

Klassifikation
Wirtschaft

Ereignis
Veröffentlichung
(wo)
Mannheim
(wann)
2007
Urheber
Garcia-Iglesias, Jesus M.

DOI
10.1080/00036840500461931
URN
urn:nbn:de:0168-ssoar-239721
Rechteinformation
Open Access unbekannt; Open Access; Der Zugriff auf das Objekt ist unbeschränkt möglich.
Letzte Aktualisierung
25.03.2025, 13:51 MEZ

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Beteiligte

  • Garcia-Iglesias, Jesus M.

Entstanden

  • 2007

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