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An impact of country-specific economic developments on ECB decisions

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  • Ullrich, Katrin

Abstract

The discussion about country-specific influence on the interest rate decisions of the European Central Bank does not cease. To investigate the possibility of regional influence on the determination of the policy rate, we estimate Taylor-type reaction functions for the period from 1999 to 2005 and include country-specific variables of the euro zone member states. We do not find convincing evidence that country-specific economic developments influence the decisions of the ECB Governing Council. However, the maximum inflation rate and the minimum economic sentiment of the euro area seem to have an effect on the decisions.

Suggested Citation

  • Ullrich, Katrin, 2006. "An impact of country-specific economic developments on ECB decisions," ZEW Discussion Papers 06-049, ZEW - Leibniz Centre for European Economic Research.
    • Handle: RePEc:zbw:zewdip:5442
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    References listed on IDEAS

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    7. Margarida Duarte, 2003. "The euro and inflation divergence in Europe," Economic Quarterly, Federal Reserve Bank of Richmond, vol. 89(Sum), pages 53-70.
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    Cited by:

    1. Hamza Bennani, 2012. "National influences inside the ECB: an assessment from central bankers' statements," Working Papers hal-00992646, HAL.
    2. repec:bla:jcmkts:v:47:y:2009:i::p:25-53 is not listed on IDEAS
    3. Christian Aubin & Ibrahima Diouf & Dominique Pepin, 2010. "Inertie De La Politique Monétaire Dans La Zone Euro : Le Rôle De L'Hétérogénéité," Post-Print hal-00960030, HAL.
    4. Marcus Drometer & Thomas Siemsen & Sebastian Watzka, 2018. "The Monetary Policy of the ECB: Caring for the Weakest Links," Kyklos, Wiley Blackwell, vol. 71(4), pages 537-556, November.
    5. Agnès Bénassy‐Quéré & Edouard Turkisch, 2009. "The ECB Governing Council in an Enlarged Euro Area," Journal of Common Market Studies, Wiley Blackwell, vol. 47(1), pages 25-53, January.

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    More about this item

    Keywords

    Taylor rule; ECB; monetary policy;
    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

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