Monetary Policy Preferences of the EMU and the UK

23 Pages Posted: 6 Jun 2016

See all articles by Philip Arestis

Philip Arestis

University of Cambridge - Department of Land Economy; University of the Basque Country

Michail Karoglou

Aston University

Kostas Mouratidis

The Sheffield University - Department of Economics

Date Written: July 2016

Abstract

We estimate the central bank policy preferences for the European Monetary Union and for the UK. In doing so, we extend the theoretical framework suggested by Cecchetti et al. (The Manchester School, Vol. 70 (2002), pp. 596–618), by assuming that policy preferences change across different regimes. Our empirical results suggest that the weight that policy makers put on inflation is typically profound. Furthermore, it appears that volatility shifts of the economic disturbances are the main factor, which generates variation in policy preferences.

Suggested Citation

Arestis, Philip and Karoglou, Michail and Mouratidis, Kostas, Monetary Policy Preferences of the EMU and the UK (July 2016). The Manchester School, Vol. 84, Issue 4, pp. 528-550, 2016, Available at SSRN: https://ssrn.com/abstract=2790391 or http://dx.doi.org/10.1111/manc.12121

Philip Arestis (Contact Author)

University of Cambridge - Department of Land Economy ( email )

19 Silver Street
Cambridge, CB3 9EP
United Kingdom

University of the Basque Country

Barrio Sarriena s/n
Leioa, Bizkaia 48940
Spain

Michail Karoglou

Aston University ( email )

Aston Triangle
Birmingham, B4 7ET
United Kingdom

Kostas Mouratidis

The Sheffield University - Department of Economics ( email )

Sheffield, S1 4DT
Great Britain

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