We propose using a simple Taylor rule to evaluate business cycle convergence of the Czech Republic, Hungary, and Poland with the Eurozone. Our findings indicate an ongoing convergence of those CEE countries to the Eurozone, but with instabilities and heterogeneity between the countries....

This paper uses time-series data from India and tests for asymmetries in policy preferences of the Reserve Bank of India (the Central Bank of India, hereafter RBI). The results show evidence in favour of preference asymmetries in monetary policy reaction function in India and hence...

This article compares two types of monetary policy rules - the Taylor-Rule and the Orphanides-Rule - with respect to their forecasting properties for the policy rates of the European Central Bank. In this respect the basic rules, results from estimated models and augmented rules are compared....

This paper estimates a New Keynesian model extended to include heterogeneous expectations, to revisit the evidence that postwar US macroeconomic data can be explained as the outcome of passive monetary policy, indeterminacy, and sunspot-driven fluctuations in the pre-1979 sample, with a switch...

This paper investigates whether a Taylor rule accurately describes the South African Reserve Bank's reaction function in setting interest rates using quarterly data, covering the period since inflation targeting was formally adopted in 2000. The classic Taylor rule is modified to determine...

n this study, we examine the evolution of the Central Bank of Nigeria's (CBN) reaction function since the adoption of the structural Adjustment Programme (SAP). We consider the role of structural breaks in the reaction function, the leading composition, as well as the driving factors behind...

This paper uses two-dimensional asymmetric Taylor reaction functions for 16 OECD-countries to account for different reactions to the inflation rate and output by central banks before or after an election of the fiscal authorities in the respective country. Important for such an investigation is...

This paper proposes that an important instrument of monetary policy of the Bundesbank, is how it communicates with the public. We argue that communication by senior central bank officials represents an instrument of monetary policy that complements changes in interest rates. Moreover, the...

Relying on Clive Granger's many and varied contributions to econometric analysis, this paper considers some of the key econometric considerations involved in estimating Taylor type rules for US data. We focus on the roles of unit roots, cointegration, structural breaks, and non-linearities to...

Many researchers have found that the lagged interest rate enters estimated monetary policy rules with overwhelming significance. However, a recent paper by Rudebusch (2002) argues that the lagged interest rate is not a fundamental component of the U.S. policy rule, and that its significance...