A Two-Pillar Phillips Curve for Switzerland
AbstractMonetary aggregates have historically played an important role in Swiss monetary policy, with the Swiss National Bank using money growth targets until 1999. Since 2000, when a new policy framework was introduced that focuses on an inflation forecast, money growth has been used as an indicator variable. Given the continued reliance on monetary aggregates, the question arises how useful money growth is for explaining future price developments. Using Swiss data spanning 1979 to 2005, this paper estimates Phillips curve models that incorporate a measure of "trend" money growth. Using M3, we find that money growth impacts on inflation. M2, however, matters only if the downward shift in nominal interest rates over the sample is taken into account.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Swiss Society of Economics and Statistics (SSES) in its journal Swiss Journal of Economics and Statistics.
Volume (Year): 143 (2007)
Issue (Month): IV (December)
Contact details of provider:
Postal: c/o SNB/BNS, Börsenstrasse 15, PO Box 2800, CH-8022 Zürich
Phone: +41 (0)44 631 32 34
Fax: +41 (0)44 631 39 01
Web page: http://www.sjes.ch
More information through EDIRC
inflation; money growth; Phillips curve; Switzerland;
Other versions of this item:
- E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
- E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
- E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Cogley, Timothy, 2002. "A Simple Adaptive Measure of Core Inflation," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 34(1), pages 94-113, February.
- Albert Jaeger, 2003. "The ECB's Money Pillar: An Assessment," IMF Working Papers 03/82, International Monetary Fund.
- Assenmacher-Wesche, Katrin & Gerlach, Stefan, 2006.
"Money Growth, Output Gaps and Inflation at Low and High Frequency: Spectral Estimates for Switzerland,"
CEPR Discussion Papers
5723, C.E.P.R. Discussion Papers.
- Assenmacher-Wesche, Katrin & Gerlach, Stefan, 2008. "Money growth, output gaps and inflation at low and high frequency: Spectral estimates for Switzerland," Journal of Economic Dynamics and Control, Elsevier, vol. 32(2), pages 411-435, February.
- Katrin Assenmacher-Wesche & Stefan Gerlach, 2006. "Money Growth, Output Gaps and Inflation at Low and High Frequency: Spectral Estimates for Switzerland," Working Papers 2006-05, Swiss National Bank.
- Jordi Gali & Mark Gertler & J. David Lopez-Salido, 2001.
"European Inflation Dynamics,"
NBER Working Papers
8218, National Bureau of Economic Research, Inc.
- Charles Wyplosz, 2001.
"Do we know how low inflation should be?,"
IHEID Working Papers
06-2001, Economics Section, The Graduate Institute of International Studies.
- Katrin Assenmacher-Wesche & M. Hashem Pesaran, 2008.
"A VECX Model of the Swiss Economy,"
CESifo Working Paper Series
2281, CESifo Group Munich.
- Assenmacher-Wesche, K. & Pesaran, M.H., 2008. "A VECX* Model of the Swiss Economy," Cambridge Working Papers in Economics 0809, Faculty of Economics, University of Cambridge.
- Katrin Assenmacher-Wesche & M. Hashem Pesaran, 2009. "A VECX* model of the Swiss economy," Economic Studies 2009-06, Swiss National Bank.
- Samuel Reynard, 2006. "Money and the Great Disinflation," Working Papers 2006-07, Swiss National Bank.
- Stefan Gerlach & Katrin Assenmacher-Wesche, 2006.
"Interpreting Euro area inflation at high and low frequencies,"
BIS Working Papers
195, Bank for International Settlements.
- Assenmacher-Wesche, Katrin & Gerlach, Stefan, 2008. "Interpreting euro area inflation at high and low frequencies," European Economic Review, Elsevier, vol. 52(6), pages 964-986, August.
- Assenmacher-Wesche, Katrin & Gerlach, Stefan, 2006. "Interpreting Euro Area Inflation at High and Low Frequencies," CEPR Discussion Papers 5632, C.E.P.R. Discussion Papers.
- Stix, Helmut & Knell, Markus, 2004. "Three Decades of Money Demand Studies. Some Differences and Remarkable Similarities," Working Papers 88, Oesterreichische Nationalbank (Austrian Central Bank).
- Nelson, Edward, 2003.
"The Future of Monetary Aggregates in Monetary Policy Analysis,"
CEPR Discussion Papers
3897, C.E.P.R. Discussion Papers.
- Nelson, Edward, 2003. "The future of monetary aggregates in monetary policy analysis," Journal of Monetary Economics, Elsevier, vol. 50(5), pages 1029-1059, July.
- Gerlach, Stefan, 2003. "The ECB's Two Pillars," CEPR Discussion Papers 3689, C.E.P.R. Discussion Papers.
- Petra Gerlach-Kristen, 2007.
"A Two-Pillar Phillips Curve for Switzerland,"
Swiss Journal of Economics and Statistics (SJES),
Swiss Society of Economics and Statistics (SSES), vol. 143(IV), pages 425-448, December.
- Fischer, Andreas M, 1993. "Is Money Really Exogenous? Testing for Weak Exogeneity in Swiss Money Demand," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 25(2), pages 248-58, May.
- Ernst Baltensperger & Thomas Jordan & Marcel Savioz, 2001. "The demand for M3 and inflation forecasts: An empirical analysis for Switzerland," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 137(2), pages 244-272, June.
- Thomas Laubach & Adam Posen, 1997. "Some comparative evidence on the effectiveness of inflation targeting," Research Paper 9714, Federal Reserve Bank of New York.
- Bruggeman, Annick & Camba-Méndez, Gonzalo & Fischer, Björn & Sousa, João, 2005. "Structural filters for monetary analysis: the inflationary movements of money in the euro area," Working Paper Series 0470, European Central Bank.
- Nicoletti-Altimari, Sergio, 2001. "Does money lead inflation in the euro area?," Working Paper Series 0063, European Central Bank.
- Andreas M. Fischer & Michel Peytrignet, 1990. "Are Larger Monetary Aggregates Interesting? Some Exploratory Evidence for Switzerland Using Feedback Models," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 126(IV), pages 505-520, December.
- Kitov, Oleg & Kitov, Ivan, 2011.
"Inflation and unemployment in Switzerland: from 1970 to 2050,"
28887, University Library of Munich, Germany.
- Oleg KITOV & Ivan KITOV, 2012. "Inflation And Unemployment In Switzerland: From 1970 To 2050," Journal of Applied Economic Sciences, Spiru Haret University, Faculty of Financial Management and Accounting Craiova, vol. 7(2(20)/ Su), pages 141-156.
- Oleg Kitov & Ivan Kitov, 2011. "Inflation and unemployment in Switzerland: from 1970 to 2050," Papers 1102.5405, arXiv.org.
- Petra Gerlach-Kristen, 2006.
"A Two-Pillar Phillips Curve for Switzerland,"
2006-09, Swiss National Bank.
- Aleksejs Melihovs & Anna Zasova, 2007. "Estimation of the Phillips Curve for Latvia," Working Papers 2007/03, Latvijas Banka.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Steiner).
If references are entirely missing, you can add them using this form.