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Uncertainty in the Estimation of Potential Output and Implications for the Conduct of Monetary Policy

Author

Listed:
  • Sra Chuenchoksan

    (Bank of Thailand)

  • Don Nakornthab

    (Bank of Thailand)

  • Surach Tanboon

    (Bank of Thailand)

Abstract

This paper looks at the implications of uncertainty in potential output estimation for the conduct of monetary policy. Our findings of potential output and the output gap for Thailand are based on commonly used methods such as the Hodrick-Prescott filter and unobserved component models. Estimation problems associated with real-time data, parameter uncertainty, and model uncertainty are investigated. In dealing with such uncertainties, we review various solutions from both theoretical and practical aspects of monetary policy design.

Suggested Citation

  • Sra Chuenchoksan & Don Nakornthab & Surach Tanboon, 2008. "Uncertainty in the Estimation of Potential Output and Implications for the Conduct of Monetary Policy," Working Papers 2008-04, Monetary Policy Group, Bank of Thailand.
  • Handle: RePEc:bth:wpaper:2008-04
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    References listed on IDEAS

    as
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