Download This PaperECB Policy Making and the Financial Crisis
20 Pages Posted: 27 Oct 2011 Last revised: 28 Oct 2011
Date Written: December 1, 2010
Abstract
We estimate Taylor rule models for the euro area using Consensus Economics forecasts of inflation and output growth for the period 1998.6-2010.8. We first examine whether the recent financial crisis has affected ECB policies. Our results indicate that the ECB puts stronger emphasis on maintaining price stability than earlier point estimates suggested. Next, we analyse whether economic developments in individual euro area countries affect ECB decisions. Despite the diverging economic developments in the countries in the euro area, notably during the recent financial crisis, we do not find support for the view that policy decisions have been influenced by regional developments.
Keywords: Taylor rule, ECB, regional influence, real time data
JEL Classification: C22, E52
Suggested Citation: Suggested Citation
Jakob De Haan
CESifo (Center for Economic Studies and Ifo Institute)
Poschinger Str. 5
Munich, DE-81679
Germany
HOME PAGE: http://www.CESifo.de
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
Empirical Estimates of Reaction Functions for the Euro Area
By Dieter Gerdesmeier and Barbara Roffia
-
An Empirical Comparison of Bundesbank and ECB Monetary Policy Rules
By Jon Faust, John H. Rogers, ...
-
Regional Influences on U.S. Monetary Policy: Some Implications For Europe
By Ellen E. Meade and Nathan Sheets
-
Is the View from the Eurotower Purely European? - National Divergence and ECB Interest Rate Policy
-
Using Taylor Rules to Understand ECB Monetary Policy
By Stephan Sauer and Jan-egbert Sturm
-
Interest Rate Reaction Functions and the Taylor Rule in the Euro Area
-
One Size Must Fit All: National Divergences in a Monetary Union
By Daniel Gros and Carsten Hefeker
-
Monetary Policy Reaction Functions: ECB Versus Bundesbank
By Bernd Hayo and Boris Hofmann