| Description |
1 online resource (30 pages) : color illustrations |
| Series |
IMF working paper ; WP/13/96 |
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IMF working paper ; WP/13/96.
|
| Contents |
Cover; Contents; I. Introduction; II. Literature Review; III. Analysis of Monetary Policy Cyclicality; Figure 1. Transitions; Figure 2. EM Transitions (Average of Rolling Correlations During Each Period); Figure 3. CoMP over Time; Figure 4. CoMP Distribution for AMs and EMs; Figure 5. Correlations and Estimated Response to Output Gaps in Taylor Rule; Figure 6. Density of Structural Break Year by Chow Test; IV. Determinants of Cyclicality; Figure 7. Comparison of Our CoMP Measures and Correlation Between Private Credit and Output Gap 1960-2009; TABLES; 1. Explaining CoMP in EMs |
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Figure 8. 10-year Rolling Correlation Between Real Interest Rates and Real GDP in 2011V. Cyclicality of Monetary Policy and Output Variability; Figure 9. Log Output Volatility for EMs, 1996-2007; VI. Case Study-The Case of Chile; 2. Result of Regression on Log Output Volatility; Figure 10. Inflation (Y/Y) and Changes in Monetary Policy; Figure 11. Real Policy Rate; Figure 12. Real Effective Exchange; Figure 13. A Simple Measure of Chile's Monetary Stance: 5-Year Backward Rolling Correlations of the Cyclical Component of the Real Policy Rate and the Output Gap |
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VII. Conclusions and Policy Recommendations3. Result of Regression on Cyclicality of Monetary Policy in Chile; BOX; Estimates of Taylor Coefficients in Literature; 4. Country Date Coverage of CoMP; APPENDIXES; I. Additional Tables and Figures; 5. Taylor Rule Results: Entire Sample Period; 6. Explaining CoMP in AMs; 7. Cross Country Regressions for EMs in 1995 and 2007; Figure 14. Correlations between Real Interest Rates and Output Gaps; Figure 15. Correlations between Nominal Interest Rates and Output Gaps; Figure 16. Comparison of Vegh-Vuletin and Our CoMP Measures, 1960-2009 |
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II. Data and SourcesReferences; Figure |
| Summary |
"In contrast to advanced markets (AMs), procyclical monetary policy has been a problem for emerging markets (EMs), with macroeconomic policies amplifying economic upswings and deepening downturns. The stark difference in policy has not been subject to extensive study and this paper attempts to address the gap. Key findings, using a large sample of EMs over the past 50 years, are: (i) EMs have adopted increasingly countercyclical monetary policy over time, although large differences remain among EMs and policies became more procyclical during the recent crisis. (ii) Inflation targeting and better institutions have been key factors behind the move to countercyclicality. (iii) Only deep financial markets allow EMs with flexible exchange rate regimes turn countercyclical. (iv) More countercyclical policy is associated with far less volatile output. The economically meaningful impact of IT on monetary policy countercyclicality and output variability is another reason in its favor, over and above better inflation outcomes"--Abstract |
| Notes |
Title from PDF title page (IMF Web site, viewed May 6, 2013) |
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"Strategy, Policy, and Review Department"--Page 2 of pdf |
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"May 2013"--Page 2 of pdf |
| Bibliography |
Includes bibliographical references (27-29) |
| Subject |
Monetary policy -- Developing countries
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Business cycles -- Developing countries
|
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Macroeconomics.
|
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Business cycles
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Macroeconomics
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Monetary policy
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Developing countries
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| Form |
Electronic book
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| Author |
McGettigan, Donal.
|
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International Monetary Fund.
|
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International Monetary Fund. Strategy, Policy, and Review Department.
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| ISBN |
9781484310168 |
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1484310160 |
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9781484381847 |
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148438184X |
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