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Evaluation of optimal monetary policy strategy in Romania in the context of fulfilment of convergence criteria

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  • Monica DAMIAN

    (“Alexandru Ioan Cuza” University, Romania)

Abstract

Adopting the euro currency implies the fulfilment of Maastricht convergence criteria, which implies a number of challenges for the macroeconomic policy mix, due to the existence of the conflict between them. The paper analyzes empirically the main monetary policy strategy in the context of euro in Romania.The results of the study show that inflation targeting is an optimal monetary policy strategy to achieve real and nominal convergence criteria.

Suggested Citation

  • Monica DAMIAN, 2011. "Evaluation of optimal monetary policy strategy in Romania in the context of fulfilment of convergence criteria," Romanian Journal of Economics, Institute of National Economy, vol. 33(2(42)), pages 146-168, December.
    • Handle: RePEc:ine:journl:v:2:y:2011:i:42:p:146-168
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    References listed on IDEAS

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    1. Willem H. Buiter & Clemens Grafe, 2002. "Anchor, float or abandon ship: exchange rate regimes for the accession countries," BNL Quarterly Review, Banca Nazionale del Lavoro, vol. 55(221), pages 111-142.
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    3. Ben-David, Dan, 1996. "Trade and convergence among countries," Journal of International Economics, Elsevier, vol. 40(3-4), pages 279-298, May.
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    5. Orlowski, Lucjan T., 2001. "From inflation targeting to the euro-peg: A model of monetary convergence for transition economies," Economic Systems, Elsevier, vol. 25(3), pages 233-251, September.
    6. Pelinescu, Elena & Caraiani, Petre, 2006. "Does the Inflation Targeting Have a Positive Role upon the Convergence of the Inflation Rate?," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 3(3), pages 39-50, September.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    monetary policy strategy; euro; inflation; Maastricht criteria.;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy

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