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No linealidades en la regla de política monetaria del Banco Central de Chile: una evidencia empírica

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  • Pablo Gonzalez

    (Universidad Alberto Hurtado)

  • Mauricio Tejada

    (Cámara Chilena de la Construcción, Santiago, Chile)

Abstract

This paper analyzes the evidence of non-linearities in the reaction function of the Central Bank of Chile as it relates to its final objective, inflation, and/or to its intermediate objectives defined by the monetary policy transmission channels. The study uses the flexible approach to non-linear inference proposed by Hamilton (2001), which allows the estimation of non-linear functions by using the data to determine the specific form of the non-linearity to be adopted instead of making any prior assumption of a particular functional form. It is observed that even though the Central Bank's response is linear in relation to the deviations of the inflation rate from its target, there is evidence of non-linearities with respect to the business cycle. Contrary to previous studies, in particular Corbo (2002), the current account gap does not have any predictive role in the reaction function for the period being analyzed.

Suggested Citation

  • Pablo Gonzalez & Mauricio Tejada, 2006. "No linealidades en la regla de política monetaria del Banco Central de Chile: una evidencia empírica," Revista de Analisis Economico – Economic Analysis Review, Universidad Alberto Hurtado/School of Economics and Business, vol. 21(1), pages 81-115, July.
    • Handle: RePEc:ila:anaeco:v:21:y:2006:i:1:p:81-115
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    Cited by:

    1. Fabián Gredig, 2007. "Asymmetric Monetary Policy Rules and the Achievement of the Inflation Target: The Case of Chile," Working Papers Central Bank of Chile 451, Central Bank of Chile.
    2. Luis F. Cernadas & E. René Aldazosa, 2011. "Estimación de una función de reacción para la política monetaria en Bolivia," Monetaria, CEMLA, vol. 0(1), pages 1-36, enero-mar.

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    More about this item

    Keywords

    Inflation Targeting; Reaction Function; Non-linear Models;
    All these keywords.

    JEL classification:

    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General

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