|
|
|
|
||||
|
||||
Monetary Convergence and Risk Premiums in the EU Candidate CountriesLucjan T. OrlowskiSacred Heart University - John F. Welch College of Business; Halle Institute for Economic Research; Centre for Social and Economic Research (CASE) November 2002 ZEI Working Paper No. B 26 2002 Abstract: This study examines the link between various monetary policy regimes and the ability to manage inflation and exchange rate risk premiums in the EU candidate countries as they undergo monetary convergence to the eurozone. The underlying hypothesis is that a system of 'flexible inflation targeting' may be an optimal policy choice for managing these two categories of risk. A model of inflation and exchange rate risk premiums within the context of inflation targeting is proposed. Recent trends in these risk premiums in Hungary, the Czech Republic and Poland are tested by using the GARCH (1,1) methodology.
Number of Pages in PDF File: 36 Keywords: Inflation risk premium, exchange rate risk premium, inflation targeting, monetary convergence, transition economies JEL Classification: E32, E52, P33 working papers seriesDate posted: February 11, 2005Suggested CitationContact Information
|
|
|||||||||||||||||||||||||||||||
© 2013 Social Science Electronic Publishing, Inc. All Rights Reserved.
FAQ
Terms of Use
Privacy Policy
Copyright
This page was processed by apollo5 in 0.735 seconds
