Inflation Targeting and an Optimal Taylor Rule for an Open Economy: Evidence for Colombia 1990-2011

Publicado en

• Latin American Journal of Economics-formerly Cuadernos de Economía

Resumen

• An optimal monetary policy Taylor rule is developed for an open economy, which we then estimate following a Markov regime-switching model for quarterly data from Colombia during 1990-2011. We find two opposite monetary regimes characterized by different policy rules: until October 2000 the Central Bank of Colombia reacted only statistically to output gap changes while after October 2000, when inflation targeting was of ficially adopted, monetary policy reacted only statistically to changes in the inflation rate. The latter regime is consistent with the Taylor principle as shown analytically and verified empirically by a unit root test for a Markov regime-switching model.

autores

• Giraldo, A.F.
• Giraldo, Andrés
• Misas, Martha
• Villa, Edgar

fecha de publicación

• 2014

Área temática

• C24 - Modelos truncados y censurados; Modelos de regresiones cambiantes; Modelos de regresión umbral
• E42 - Sistemas monetarios; Patrones; Regímenes; Gobierno y sistema monetario; Sistemas de pago
• E52 - Política monetaria
• E58 - Bancos centrales y sus políticas
• N16 - Macroeconomía y economía monetaria; Crecimiento y fluctuación económica: América Latina; Caribe

Enfoque geográfico

• Colombia  Country
• South America  Continent

Líneas de investigación

• Inflation Targeting
• Markov Switching
• Optimal Taylor Rule
• Taylor Principle

Página inicial

• 41

Última página

• 83

Volumen

• 51

Issue

• 1