Estimation of weights for the Monetary Conditions Index in Poland
Andrzej Torój ()
No 27, Working Papers from Department of Applied Econometrics, Warsaw School of Economics
In this paper, we follow the econometric approach to assess relative importance of real interest rate and real exchange rate for the monetary conditions in Poland, quantified as weights for Monetary Conditions Index (MCI). We consider both single- and multiple-equation specifications proposed in the literature with an application to Poland. Although MCI is nowadays broadly considered a rather obsolete indicator in monetary policy conduct, we argue that the econometric framework used for this purpose could be a good departure point when modelling monetary adjustments in a monetary union, provided correct dynamic specification of the models.
Keywords: Monetary Conditions Index; MCI-ratio; IS curve; Phillips curve; VAR. (search for similar items in EconPapers)
JEL-codes: C22 C32 E52 E59 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba, nep-mac and nep-mon
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Persistent link: https://EconPapers.repec.org/RePEc:wse:wpaper:27
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