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Does single monetary policy have asymmetric real effects in EMU?

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  • Huchet, Marilyne

Abstract

This article compares reactions of economies in Economic Monetary Union to a single monetary policy. For that, we estimate a reaction function supposed to represent the behaviour of European Central Bank over the period 1980-1998. Then residuals are introduced into the production equation of each country. We break up monetary shocks in two axes: first, anticipated against unanticipated shocks and then positive against negative shocks. These distinctions permit a best evaluation of the degree of homogeneity of the effects of monetary policy. France, Germany, Spain and Austria seem more sensitive to unanticipated interest rates increases contrary to Belgium and Italy. These results illustrate all the problem of single monetary policy.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Policy Modeling.

Volume (Year): 25 (2003)
Issue (Month): 2 (February)
Pages: 151-178

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Handle: RePEc:eee:jpolmo:v:25:y:2003:i:2:p:151-178

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Web page: http://www.elsevier.com/locate/inca/505735

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References

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  12. Karras, Georgios, 1996. "Are the Output Effects of Monetary Policy Asymmetric? Evidence from a Sample of European Countries," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 58(2), pages 267-78, May.
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  14. George A. Kahn, 1988. "Nominal GNP: an anchor for monetary policy?," Economic Review, Federal Reserve Bank of Kansas City, issue Nov, pages 18-35.
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Cited by:
  1. van der Cruijsen, Carin & Demertzis, Maria, 2011. "How anchored are inflation expectations in EMU countries?," Economic Modelling, Elsevier, vol. 28(1-2), pages 281-298, January.
  2. Jesús Crespo-Cuaresma & Octavio Fernández-Amador, 2010. "Business cycle convergence in EMU: A second look at the second moment," FIW Working Paper series 056, FIW.
  3. Yang, Zan & Wang, Songtao & Campbell, Robert, 2010. "Monetary policy and regional price boom in Sweden," Journal of Policy Modeling, Elsevier, Elsevier, vol. 32(6), pages 865-879, November.
  4. Alagidede, Paul & Coleman, Simeon & Cuestas, Juan Carlos, 2012. "Inflationary shocks and common economic trends: Implications for West African monetary union membership," Journal of Policy Modeling, Elsevier, Elsevier, vol. 34(3), pages 460-475.

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