Asymmetries In Monetary Policy Rules: Evidence For Four Central Banks

Juan Dolado, María-Dolores, Ramón and Manuel Naveira Barrero
Authors registered in the RePEc Author Service: Ramón Maria-Dolores

No 2441, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This paper investigates the possible existence of asymmetric effects in the response of four central banks to inflation and output gaps as regards the 'sign' and 'size' of those gaps. The evidence obtained both through the estimation of a generalized Taylor rule and an ordered probit model points out that most central banks show a stronger reaction to inflation upswings relative to downswings. However, except for the Federal Reserve, no asymmetric behaviour with respect to the output gap is found.

Keywords: Asymmetries; Ordered probit models; Taylor rules (search for similar items in EconPapers)
JEL-codes: E52 E58 (search for similar items in EconPapers)
Date: 2000-04
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Citations: View citations in EconPapers (48)

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