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Financial Constraints, the User Cost of Capital and Corporate Investment in Australia
Cava, Gianni La - Reserve Bank of Australia - 2005
This paper examines the factors that drive corporate investment in Australia using a panel of listed companies covering … the period from 1990 to 2004. Real sales growth is found to be a significant determinant of corporate investment. The user … paper also explores the effects of cash flow on investment, allowing for the possibility that the availability of internal …
Persistent link: https://www.econbiz.de/10005423651
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Learning in an Estimated Small Open Economy Model
Jääskelä, Jarkko; McKibbin, Rebecca - Reserve Bank of Australia - 2010
Expectations of the future play a key role in the transmission of monetary policy. Over recent years, a lot of theoretical and applied macroeconomic research has been based on the assumption of rational expectations. However, estimated models based on this assumption typically fail to capture...
Persistent link: https://www.econbiz.de/10008502860
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The Role of International Shocks in Australia’s Business Cycle
Liu, Philip - Reserve Bank of Australia - 2008
This paper examines the sources of Australia’s business cycle fluctuations. The cyclical component of GDP is extracted using the Beveridge-Nelson decomposition and a structural VAR model is identified using robust sign restrictions derived from a small open economy model. In contrast to...
Persistent link: https://www.econbiz.de/10005423551
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The Butterfly Effect of Small Open Economies
Jääskelä, Jarkko; Kulish, Mariano - Reserve Bank of Australia - 2007
The rational expectations equilibrium of a small open economy can be subject to indeterminacy if foreign monetary policy does not satisfy the Taylor principle. We study the implications of foreign-induced indeterminacy for the conduct of monetary policy in a small open economy. In the canonical...
Persistent link: https://www.econbiz.de/10005232575
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Monetary Policy, Asset-price Bubbles and the Zero Lower Bound
Robinson, Tim; Stone, Andrew - Reserve Bank of Australia - 2005
We use a simple model of a closed economy to study the recommendations of monetary policy-makers attempting to respond optimally to an asset-price bubble whose stochastic properties they understand. We focus on the impact which the zero lower bound (ZLB) on nominal interest rates has on the...
Persistent link: https://www.econbiz.de/10005423553
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Declining Output Volatility: What Role for Structural Change?
Kent, Christopher; Smith, Kylie; Holloway, James - Reserve Bank of Australia - 2005
The decline in output volatility in a number of countries over the past few decades has been well-documented, though less agreement has been reached about the causes of this decline. In this paper, we use a panel of data from 20 OECD countries to see if there is a role for various indicators of...
Persistent link: https://www.econbiz.de/10005423569
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Optimal Monetary Policy with Real-time Signal Extraction from the Bond Market
Nimark, Kristoffer - Reserve Bank of Australia - 2006
Monetary policy is conducted in an environment of uncertainty. This paper sets up a model where the central bank uses real-time data from the bond market together with standard macroeconomic indicators to estimate the current state of the economy more efficiently, while taking into account that...
Persistent link: https://www.econbiz.de/10005423572
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Output Gaps in Real Time: Are They Reliable Enough to Use for Monetary Policy?
Gruen, David; Robinson, Tim; Stone, Andrew - Reserve Bank of Australia - 2002
The output gap – the difference between actual and potential output – is widely regarded as a useful guide to future inflationary pressures, as well as an important indicator of the state of the economy in its own right. Since the output gap is unobservable, however, its estimation is prone...
Persistent link: https://www.econbiz.de/10005426698
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The Real-time Forecasting Performance of Phillips Curves
Robinson, Tim; Stone, Andrew; Zyl, Marileze van - Reserve Bank of Australia - 2003
Analysts typically use a variety of techniques to forecast inflation. These include both ‘bottom-up’ approaches, for near-term forecasting, as well as econometric methods (such as mark-up models of inflation, which have been found to perform quite well for Australia – see de Brouwer and...
Persistent link: https://www.econbiz.de/10005426730
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A Sectoral Model of the Australian Economy
Lawson, Jeremy; Rees, Daniel - Reserve Bank of Australia - 2008
the expenditure and production components of GDP over the period from 1983 to 2007. We find that dwelling investment and … machinery & equipment investment are the most interest-sensitive expenditure components of activity, and that construction and …
Persistent link: https://www.econbiz.de/10005577179