Low-inflation-targeting monetary policy and differential unemployment rate: Is monetary policy to be blamed for the financial crisis? — Evidence from major OECD countries
Author
Abstract
Suggested Citation
DOI: 10.1016/j.econmod.2012.09.042
Download full text from publisher
As the access to this document is restricted, you may want to search for a different version of it.
References listed on IDEAS
- Carlo Altavilla & Matteo Ciccarelli, 2006.
"Inflation Forecasts, Monetary Policy and Unemployment Dynamics: Evidence from the US and the Euro Area,"
Discussion Papers
7_2006, D.E.S. (Department of Economic Studies), University of Naples "Parthenope", Italy.
- Matteo Ciccarelli & Carlo Altavilla, 2007. "Inflation Forecasts, Monetary Policy and Unemployment Dynamics: Evidence from the US and the Euro area," 2007 Meeting Papers 315, Society for Economic Dynamics.
- Ciccarelli, Matteo & Altavilla, Carlo, 2007. "Inflation Forecasts, monetary policy and unemployment dynamics: evidence from the US and the euro area," Working Paper Series 725, European Central Bank.
- Goncalves, Carlos Eduardo S. & Salles, Joao M., 2008. "Inflation targeting in emerging economies: What do the data say?," Journal of Development Economics, Elsevier, vol. 85(1-2), pages 312-318, February.
- Charles Freedman & Tiff Macklem, 1998. "A Comment on "The Great Canadian Slump"," Canadian Journal of Economics, Canadian Economics Association, vol. 31(3), pages 646-665, August.
- Allan Crawford & Seamus Hogan, 1999. "Downward wage rigidity," Bank of Canada Review, Bank of Canada, vol. 1998(Winter), pages 29-48.
- Allan Crawford, 2001. "How Rigid Are Nominal-Wage Rates?," Staff Working Papers 01-8, Bank of Canada.
- John C. Williams, 2009.
"Heeding Daedalus: Optimal Inflation and the Zero Lower Bound,"
Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 40(2 (Fall)), pages 1-49.
- John C. Williams, 2009. "Heeding Daedalus: Optimal inflation and the zero lower bound," Working Paper Series 2009-23, Federal Reserve Bank of San Francisco.
- Nicoletta Batini & Douglas Laxton, 2007.
"Under What Conditions Can Inflation Targeting Be Adopted? The Experience of Emerging Markets,"
Central Banking, Analysis, and Economic Policies Book Series, in: Frederic S. Miskin & Klaus Schmidt-Hebbel & Norman Loayza (Series Editor) & Klaus Schmidt-Hebbel (Se (ed.),Monetary Policy under Inflation Targeting, edition 1, volume 11, chapter 12, pages 467-506,
Central Bank of Chile.
- Nicoletta Batini & Douglas Laxton, 2006. "Under What Conditions Can Inflation Targeting Be Adopted? The Experience of Emerging Markets," Working Papers Central Bank of Chile 406, Central Bank of Chile.
- Mr. Irineu E de Carvalho Filho, 2010.
"Inflation Targeting and the Crisis: An Empirical Assessment,"
IMF Working Papers
2010/045, International Monetary Fund.
- de Carvalho Filho, Irineu, 2010. "Inflation Targeting and the Crisis: An Empirical Assessment," MPRA Paper 19960, University Library of Munich, Germany.
- Michael Bowe & Nikolaos Mylonidis, 1999. "Is the European Capital Market Ready for the Single Currency?," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 26(1‐2), pages 1-32, January.
- Umar Faruqui, 2000. "Employment Effects Of Nominal-Wage Rigidity: An Examination Using Wage-Settlements Data," Staff Working Papers 00-14, Bank of Canada.
- Stock, James H & Watson, Mark W, 1993.
"A Simple Estimator of Cointegrating Vectors in Higher Order Integrated Systems,"
Econometrica, Econometric Society, vol. 61(4), pages 783-820, July.
- James H. Stock & Mark W. Watson, 1991. "A simple estimator of cointegrating vectors in higher order integrated systems," Working Paper Series, Macroeconomic Issues 91-3, Federal Reserve Bank of Chicago.
- Yifan Hu, 2006. "The choice of inflation targeting—an empirical investigation," International Economics and Economic Policy, Springer, vol. 3(1), pages 27-42, April.
- Frankel, Jeffrey A. & MacArthur, Alan T., 1988.
"Political vs. currency premia in international real interest differentials : A study of forward rates for 24 countries,"
European Economic Review, Elsevier, vol. 32(5), pages 1083-1114, June.
- Jeffrey A. Frankel & Alan T. MacArthur, 1987. "Political vs. Currency Premia in International Real Interest Differentials: A Study of Forward Rates for 24 Countries," NBER Working Papers 2309, National Bureau of Economic Research, Inc.
- Jeffrey A. Frankel and Alan T. MacArthur., 1987. "Political vs. Currency Premia in International Real Interest Differentials: A Study of Forward Rates for 24 Countries," Economics Working Papers 8762, University of California at Berkeley.
- Brito, Ricardo D. & Bystedt, Brianne, 2010.
"Inflation targeting in emerging economies: Panel evidence,"
Journal of Development Economics, Elsevier, vol. 91(2), pages 198-210, March.
- Bystedt, Brianne & Brito, Ricardo D., 2008. "Inflation targeting in emerging economies: Panel evidence," Insper Working Papers wpe_125, Insper Working Paper, Insper Instituto de Ensino e Pesquisa.
- Meese, Richard A. & Rogoff, Kenneth, 1983. "Empirical exchange rate models of the seventies : Do they fit out of sample?," Journal of International Economics, Elsevier, vol. 14(1-2), pages 3-24, February.
- George A. Akerlof & William R. Dickens & George L. Perry, 1996. "The Macroeconomics of Low Inflation," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 27(1), pages 1-76.
- Tobin, James, 1972. "Inflation and Unemployment," American Economic Review, American Economic Association, vol. 62(1), pages 1-18, March.
- Inder, Brett, 1993. "Estimating long-run relationships in economics : A comparison of different approaches," Journal of Econometrics, Elsevier, vol. 57(1-3), pages 53-68.
- Sean Collins & Pierre L. Siklos, 2004. "Optimal Monetary Policy Rules and Inflation Targets: Are Australia, Canada, and New Zealand Different from the U.S.?," Open Economies Review, Springer, vol. 15(4), pages 347-362, October.
- Karfakis, Costas J & Moschos, Demetrios M, 1990.
"Interest Rate Linkages within the European Monetary System: A Time Series Analysis,"
Journal of Money, Credit and Banking, Blackwell Publishing, vol. 22(3), pages 389-394, August.
- Karfakis, C. J. & Moschos, D.M., 1990. "Interest Rate Linkages Within the European Monetary System: A Time Series Analysis," Working Papers 144, University of Sydney, School of Economics.
- Guenter W. Beck & Kirstin Hubrich & Massimiliano Marcellino, 2009.
"Regional inflation dynamics within and across euro area countries and a comparison with the United States [‘On the relevance and nature of regional inflation differentials: The case of Spain’, Banc,"
Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 24(57), pages 142-184.
- Kirstin Hubrich, 2008. "Regional inflation dynamics within and across euro area countries and a comparison with the United States," Research Bulletin, European Central Bank, vol. 7, pages 7-9.
- Engle, Robert & Granger, Clive, 2015.
"Co-integration and error correction: Representation, estimation, and testing,"
Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 39(3), pages 106-135.
- Engle, Robert F & Granger, Clive W J, 1987. "Co-integration and Error Correction: Representation, Estimation, and Testing," Econometrica, Econometric Society, vol. 55(2), pages 251-276, March.
- von Hagen, Jurgen & Hofmann, Boris, 2004.
"Macroeconomic implications of low inflation in the euro area,"
The North American Journal of Economics and Finance, Elsevier, vol. 15(1), pages 5-23, March.
- von Hagen, Jürgen & Hofmann, Boris, 2003. "Macroeconomic implications of low inflation in the euro area," ZEI Working Papers B 29-2003, University of Bonn, ZEI - Center for European Integration Studies.
- Katsimbris, George M & Miller, Stephen M, 1993. "Interest Rate Linkages within the European Monetary System: Further Analysis," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 25(4), pages 771-779, November.
- Olivier Blanchard & Giovanni Dell’Ariccia & Paolo Mauro, 2010.
"Rethinking Macroeconomic Policy,"
Journal of Money, Credit and Banking, Blackwell Publishing, vol. 42(s1), pages 199-215, September.
- Olivier Blanchard & Giovanni Dell'Ariccia & Paolo Mauro, 2010. "Rethinking Macroeconomic Policy," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 42(s1), pages 199-215, September.
- Mr. Olivier J Blanchard & Mr. Giovanni Dell'Ariccia & Mr. Paolo Mauro, 2010. "Rethinking Macroeconomic Policy," IMF Staff Position Notes 2010/003, International Monetary Fund.
- Frankel, Jeffrey A, 1992. "Measuring International Capital Mobility: A Review," American Economic Review, American Economic Association, vol. 82(2), pages 197-202, May.
- George A. Akerlof & William T. Dickens & George L. Perry, 2000. "Near-Rational Wage and Price Setting and the Long-Run Phillips Curve," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 31(1), pages 1-60.
- Laurence M. Ball, 1997.
"Disinflation and the NAIRU,"
NBER Chapters, in: Reducing Inflation: Motivation and Strategy, pages 167-194,
National Bureau of Economic Research, Inc.
- Laurence Ball, 1996. "Disinflation and the NAIRU," NBER Working Papers 5520, National Bureau of Economic Research, Inc.
- Jean Farès & Seamus Hogan, 2000. "The Employment Costs of Downward Nominal-Wage Rigidity," Staff Working Papers 00-1, Bank of Canada.
- repec:syd:wpaper:144 is not listed on IDEAS
- Wayne Simpson & Norman E. Cameron & Derek Hum, 1998. "Is Hypoinflation Good Policy?," Canadian Public Policy, University of Toronto Press, vol. 24(3), pages 291-308, September.
- Pierre Fortin, 1996. "The Great Canadian Slump," Canadian Journal of Economics, Canadian Economics Association, vol. 29(4), pages 761-787, November.
- Montalvo, Jose G., 1995. "Comparing cointegrating regression estimators: Some additional Monte Carlo results," Economics Letters, Elsevier, vol. 48(3-4), pages 229-234, June.
- David H. Romer, 2000.
"Keynesian Macroeconomics without the LM Curve,"
Journal of Economic Perspectives, American Economic Association, vol. 14(2), pages 149-169, Spring.
- David Romer, 2000. "Keynesian Macroeconomics without the LM Curve," NBER Working Papers 7461, National Bureau of Economic Research, Inc.
- Olivier Blanchard & Giovanni Dell'Ariccia & Paolo Mauro, 2010.
"Rethinking Macroeconomic Policy,"
Journal of Money, Credit and Banking,
Blackwell Publishing, vol. 42(s1), pages 199-215, September.
- Olivier J Blanchard & Giovanni Dell'Ariccia & Paolo Mauro, 2010. "Rethinking Macroeconomic Policy," IMF Staff Position Notes 2010/03, International Monetary Fund.
- Johansen, Soren, 1988. "Statistical analysis of cointegration vectors," Journal of Economic Dynamics and Control, Elsevier, vol. 12(2-3), pages 231-254.
- Per Lundborg & Hans Sacklén, 2006. "Low‐inflation Targeting and Long‐run Unemployment," Scandinavian Journal of Economics, Wiley Blackwell, vol. 108(3), pages 397-418, October.
- Michael Bowe & Nikolaos Mylonidis, 1999.
"Is the European Capital Market Ready for the Single Currency?,"
Journal of Business Finance & Accounting,
Wiley Blackwell, vol. 26(1‐2), pages 1-32, January.
- Michael Bowe & Nikolaos Mylonidis, 1999. "Is the European Capital Market Ready for the Single Currency?," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 26(1-2), pages 1-32.
Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
Cited by:
- Mohammad Khanssa & Wafaa Nasser & Abbas Mourad, 2018. "An Econometric Analysis of Inflation and Unemployment in Lebanon: A Vector Error Correction Model (VECM)," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 10(2), pages 133-141, February.
- José De Gregorio, 2009. "Implementation of Inflation Targets in Emerging Markets," Chapters, in: Gill Hammond & Ravi Kanbur & Eswar Prasad (ed.), Monetary Policy Frameworks for Emerging Markets, chapter 3, Edward Elgar Publishing.
- Pierre-Richard Agénor & Luiz A. Pereira da Silva, 2013. "Inflation Targeting and Financial Stability: A Perspective from the Developing World," Working Papers Series 324, Central Bank of Brazil, Research Department.
- Shahzad, Umer & Orsi, Bianca & Sharma, Gagan Deep, 2024. "Managing inflation expectations and the efficiency of monetary policy responses to energy crises," Energy Economics, Elsevier, vol. 133(C).
- Armand Fouejieu,, 2017. "Inflation targeting and financial stability in emerging markets," Economic Modelling, Elsevier, vol. 60(C), pages 51-70.
- Pervin, Shahida, 2018. "Dynamics and Interactions of Monetary Policy and Macroeconomic Variables: Empirical Investigation in the UK Economy with Bayesian VAR," MPRA Paper 91816, University Library of Munich, Germany.
- Renée A. Fry-McKibbin & Chen Wang, 2014. "Does Inflation Targeting Outperform Alternative Policies during Global Downturns?," CAMA Working Papers 2014-64, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
- Ho-Chuan Huang & Chih-Chuan Yeh, 2014. "Inflation targeting on unemployment rates: a quantile treatment effect approach," Applied Economics Letters, Taylor & Francis Journals, vol. 21(7), pages 453-458, May.
Most related items
These are the items that most often cite the same works as this one and are cited by the same works as this one.- Dany Brouillette & Olena Kostyshyna & Natalia Kyui, 2018.
"Downward nominal wage rigidity in Canada: Evidence from micro-level data,"
Canadian Journal of Economics, Canadian Economics Association, vol. 51(3), pages 968-1002, August.
- Dany Brouillette & Olena Kostyshyna & Natalia Kyui, 2018. "Downward nominal wage rigidity in Canada: Evidence from micro‐level data," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 51(3), pages 968-1002, August.
- Dany Brouillette & Olena Kostyshyna & Natalia Kyui, 2016. "Downward Nominal Wage Rigidity in Canada: Evidence from Micro- Level Data," Staff Working Papers 16-40, Bank of Canada.
- Pierre Fortin, 2013. "The Macroeconomics of Downward Nominal Wage Rigidity : a Review of the Issues and New Evidence for Canada," Cahiers de recherche 1309, CIRPEE.
- Pierre Fortin & George A. Akerlof & William T. Dickens & George L. Perry, 2002. "Inflation and Unemployment in the U.S. and Canada: A Common Framework," Cahiers de recherche du Département des sciences économiques, UQAM 20-16, Université du Québec à Montréal, Département des sciences économiques.
- Louis N. Christofides & Thanasis Stengos, 2003.
"Wage Rigidity in Canadian Collective Bargaining Agreements,"
ILR Review, Cornell University, ILR School, vol. 56(3), pages 429-448, April.
- Louis N. Christofides & Thanasis Stengos, 2003. "Wage Rigidity in Canadian Collective Bargaining Agreements," University of Cyprus Working Papers in Economics 1-2003, University of Cyprus Department of Economics.
- Louis Christofides & Thanasis Stengos, 2001. "Nominal Wage Rigidity: Non-Parametric Tests Based on Union Data for Canada," CESifo Working Paper Series 535, CESifo.
- Junankar, Pramod N. (Raja), 2019. "Monetary Policy, Growth and Employment in Developing Areas: A Review of the Literature," IZA Discussion Papers 12197, Institute of Labor Economics (IZA).
- Christopher Ragan, 2011. "Precision Targeting: The Economics – and Politics – of Improving Canada’s Inflation-Targeting Framework," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 321, February.
- Kuroda, Sachiko & Yamamoto, Isamu, 2003. "The Impact of Downward Nominal Wage Rigidity on the Unemployment Rate: Quantitative Evidence from Japan," Monetary and Economic Studies, Institute for Monetary and Economic Studies, Bank of Japan, vol. 21(4), pages 57-85, December.
- Alexander Ludwig, 2014. "Credit risk-free sovereign bonds under Solvency II: a cointegration analysis with consistently estimated structural breaks," Applied Financial Economics, Taylor & Francis Journals, vol. 24(12), pages 811-823, June.
- Kasman, Adnan & Kirbas-Kasman, Saadet & Turgutlu, Evrim, 2008. "Monetary policy convergence of potential EMU accession countries: A cointegration analysis with shifting regimes," Economic Modelling, Elsevier, vol. 25(2), pages 340-350, March.
- Stéphane Dupraz, 2024.
"A Kinked‐Demand Theory of Price Rigidity,"
Journal of Money, Credit and Banking, Blackwell Publishing, vol. 56(2-3), pages 325-363, March.
- Stephane Dupraz, 2017. "A Kinked-Demand Theory of Price Rigidity," 2017 Meeting Papers 387, Society for Economic Dynamics.
- S. Dupraz, 2017. "A Kinked-Demand Theory of Price Rigidity," Working papers 656, Banque de France.
- Pierre Fortin, 2016. "A Stable 4% Inflation Could Get Canadians One Half Million More Jobs," Cahiers de recherche 1604, CIRPEE.
- Stojanovikj, Martin & Petrevski, Goran, 2019. "Adopting inflation targeting in emerging markets: exploring the factors behind the decision," MPRA Paper 115797, University Library of Munich, Germany, revised 18 Jun 2020.
- de Carvalho Filho Irineu E, 2011.
"28 Months Later: How Inflation Targeters Outperformed Their Peers in the Great Recession,"
The B.E. Journal of Macroeconomics, De Gruyter, vol. 11(1), pages 1-46, July.
- de Carvalho Filho, Irineu, 2011. "28 Months Later: How Inflation Targeters Outperformed Their Peers in the Great Recession," MPRA Paper 29100, University Library of Munich, Germany.
- Paul Jenkins & Brian O'Reilly, 2001. "Monetary Policy and the Economic Well-being of Canadians," The Review of Economic Performance and Social Progress, in: Andrew Sharpe, Executive Director & France St-Hilaire, Vice-President , Research & Keith Banting, Di (ed.), The Review of Economic Performance and Social Progress 2001: The Longest Decade: Canada in the 1990s, volume 1, Centre for the Study of Living Standards;The Institutute for Research on Public Policy.
- Petrevski, Goran, 2023.
"Macroeconomic Effects of Inflation Targeting: A Survey of the Empirical Literature,"
EconStor Preprints
271122, ZBW - Leibniz Information Centre for Economics.
- Goran Petrevski, 2023. "Macroeconomic Effects of Inflation Targeting: A Survey of the Empirical Literature," Papers 2305.17474, arXiv.org.
- Ha,Jongrim & Ivanova,Anna & Ohnsorge,Franziska Lieselotte & Unsal Portillo Ocando,Derya Filiz, 2019. "Inflation : Concepts, Evolution, and Correlates," Policy Research Working Paper Series 8738, The World Bank.
- Louis N. Christofides & Man Tuen Leung, 2002. "Nominal Wage Rigidity in Contract Data: A Parametric Approach," University of Cyprus Working Papers in Economics 0210, University of Cyprus Department of Economics.
- Pierpaolo Benigno & Luca Antonio Ricci, 2011.
"The Inflation-Output Trade-Off with Downward Wage Rigidities,"
American Economic Review, American Economic Association, vol. 101(4), pages 1436-1466, June.
- Pierpaolo Benigno & Luca Antonio Ricci, 2010. "The Inflation-Output Trade-off with Downward Wage Rigidities," NBER Working Papers 15762, National Bureau of Economic Research, Inc.
- Pierpaolo Benigno & Luca Antonio Ricci, 2010. "The Inflation-Output Trade-off with Downward Wage Rigidities," EIEF Working Papers Series 1020, Einaudi Institute for Economics and Finance (EIEF), revised Apr 2010.
- G. Everaert, 2007. "Estimating Long-Run Relationships between Observed Integrated Variables by Unobserved Component Methods," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 07/452, Ghent University, Faculty of Economics and Business Administration.
More about this item
Keywords
Differential interest rate; Differential unemployment rate; OECD vs.USA; SVAR; Cointegration analysis; Inflation targeting; Monetary policy effectiveness;All these keywords.
JEL classification:
- C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
- E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
- F02 - International Economics - - General - - - International Economic Order and Integration
Statistics
Access and download statisticsCorrections
All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ecmode:v:30:y:2013:i:c:p:546-564. See general information about how to correct material in RePEc.
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/30411 .
Please note that corrections may take a couple of weeks to filter through the various RePEc services.