Macro-Governance Aspects of Monetary Policy Accommodation Under Varying Regimes: An Assessment Using Greek Data

EKONOMIA: Volume 12, No.1, Summer 2009 The Journal of the Cyprus Economic Society

37 Pages Posted: 21 Jul 2012

Abstract

This paper has a two-fold orientation; firstly, it examines the linkages and the time-series properties of a set of nominal and real macroeconomic variables in Greece, under different exchange rate systems and varying fiscal regimes. Secondly, it makes an effort to evaluate some macro-governance aspects of monetary policy performance. In essence, it measures the extent to which monetary policy has been used to accommodate foreign disturbances and fiscal policy changes. Concerning the former, prices have played a central role between nominal and real variables while verifying evidence on inflation persistence. Regarding the latter, the central bank is primarily responding, on average, to domestic rather than foreign conditions implying a non-operative monetary-transmission mechanism. In principle, the monetary authorities appear to have engaged in accommodative, and to a lesser extent sterilisation, schemes of policy action, notwithstanding the clear tendency towards systematic control, thereby suggesting consistency with the conventional priors of policy-competence hypothesis.

Keywords: Monetary Policy, BOPs, Growth, Budget Deficits, Inflation, Granger-Causality

JEL Classification: C4, E5, F0, H5

Suggested Citation

Stournaras, Christos F., Macro-Governance Aspects of Monetary Policy Accommodation Under Varying Regimes: An Assessment Using Greek Data. EKONOMIA: Volume 12, No.1, Summer 2009 The Journal of the Cyprus Economic Society , Available at SSRN: https://ssrn.com/abstract=2112942

Christos F. Stournaras (Contact Author)

Independent ( email )

No Address Available
Greece

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