MONETARY POLICY REGIMES: FUNCTIONAL FRAMEWORK AND IMPLICATIONS

Radu Cuhal, Ludmila Starițîna and Nicolae Basistîi
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Radu Cuhal: National Bank of Moldova, Chişinău, Republic of Moldova
Ludmila Starițîna: National Bank of Moldova, Chişinău, Republic of Moldova
Nicolae Basistîi: National Bank of Moldova, Chişinău, Republic of Moldova

Journal of Financial and Monetary Economics, 2014, vol. 1, issue 1, 92-100

Abstract: The contribution of this paper is the delineation of the concept of the “monetary regime”, which implies specification of a numerical target that commits the central bank to achieve the primary goal of the monetary policy. We considered that the monetary policy regimes represent an attempt to develop a proper framework of the monetary reaction function based on the different theoretical approaches of monetary transmission channels, from the practical point of view (Barro R., 1995; McCallum B., et al. 1999). The dynamics of the targeted indicator may serve also as an early shock indicator and provide a better foundation for policy-makers decisions. In this paper we propose to investigate the fundamental basis of different monetary policy regimes, a greater emphasis being put on the functional mechanism of each regime and its effects.

Keywords: Central bank; monetary policy regimes; inflation targeting; monetary transmission channels (search for similar items in EconPapers)
JEL-codes: E31 E52 E58 (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:vls:rojfme:v:1:y:2014:i:1:p:92-100

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