IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

Verifying Time Inconsistency of the ECB Monetary Policy bya Regime-Switching Approach

Listed author(s):
  • Andrea Beccarini
Registered author(s):

    This work aims to verify whether there is an inflation bias in the Euro-area monetary policy. One verify the presence of a strategic repeated game between the European Central Bank and the market in setting actual and expected inflation and what the features of this game are. In particular, the aim is to verify whether the market fixes the expected inflation strategically and how the probability about the kind of monetary policy is formed. One concludes that the market behaves strategically but the inflation bias does not emerge from data. The ECB is not deemed credible with a probability of one third. However, it is clear that the source of credibility cannot be the lack of commitment of the bank, but it can be the partial inability to control or to communicate economic shocks. These conclusions are robust to two different estimation strategies which are both based on regime-switching regressions.

    If 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.

    File URL:
    File Function: Version of January, 2012
    Download Restriction: no

    Paper provided by Center for Quantitative Economics (CQE), University of Muenster in its series CQE Working Papers with number 2212.

    in new window

    Length: 43 pages
    Date of creation: Jan 2012
    Handle: RePEc:cqe:wpaper:2212
    Contact details of provider: Postal:
    Am Stadtgraben 9, 48143 M√ľnster, Germany

    Phone: +49.(0).251.83-25041
    Fax: +49.(0).251.83-25042
    Web page:

    More information through EDIRC

    No references listed on IDEAS
    You can help add them by filling out this form.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:cqe:wpaper:2212. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Susanne Deckwitz)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.