Please use this identifier to cite or link to this item:
https://hdl.handle.net/10216/71353
Author(s): | Álvaro Aguiar Manuel Mota Freitas Martins |
Title: | Testing for Asymmetries in the Preferences of the Euro-Area Monetary Policymaker (FEP Working Paper Nº 182, Faculdade de Economia da Universidade do Porto, Julho 2005) |
Issue Date: | 2005 |
Abstract: | This paper tests for asymmetries in the preferences of the Euro-Area monetary policymaker with 1995:I-2005:II data from the last update of the ECB's Area-wide database. Following the relevant literature, we distinguish between three types of asymmetry: precautionary demand for expansions, precautionary demand for price stability and interest rate smoothing asymmetry. Based on the joint GMM estimation of the Euler equation of optimal policy and the AS-AD structure of the macroeconomy, we find evidence of precautionary demand for price stability in the preferences revealed by the monetary policymaker. This type of asymmetry is consistent with the ECB's definition of price stability and with the priority of credibility-building by a recently created monetary authority. |
Subject: | Economia, Economia e gestão Economics, Economics and Business |
Scientific areas: | Ciências sociais::Economia e gestão Social sciences::Economics and Business |
URI: | https://hdl.handle.net/10216/71353 |
Document Type: | Relatório Técnico |
Rights: | openAccess |
License: | https://creativecommons.org/licenses/by-nc/4.0/ |
Appears in Collections: | FEP - Relatório Técnico |
Files in This Item:
File | Description | Size | Format | |
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40338.pdf | FEP Working Paper Nº 182, Faculdade de Economia da Universidade do Porto, Julho 2005 | 1.02 MB | Adobe PDF | View/Open |
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