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Approximating Monetary Policy: Case Study for the ASEAN-5

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  • Arief Ramayandi

    (Department of Economics, Padjadjaran University)

Abstract

Empirical studies on the process of monetary policy making in a number of advanced economies have shown that a simple policy reaction function (PRF) performs well in explaining the setting of monetary policy. This paper examines an application of a simple PRF in an attempt to broaden the understanding of monetary policy making processes in five developing ASEAN countries. As found to be the case in the more advanced economies, a simple PRF is also found to perform well in explaining the setting of monetary policy in these countries. Moreover, the findings uncover the main drivers behind the conduct of monetary policy and provide a relatively consistent explanation about the monetary policy episodes in the sample economies.

Suggested Citation

  • Arief Ramayandi, 2007. "Approximating Monetary Policy: Case Study for the ASEAN-5," Working Papers in Economics and Development Studies (WoPEDS) 200707, Department of Economics, Padjadjaran University, revised Aug 2007.
    • Handle: RePEc:unp:wpaper:200707
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    References listed on IDEAS

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    Cited by:

    1. Khalid, Norlin & Abdul Karim, Zulkefly & Yussof, Izzuddin, 2014. "Testing a Non-Linear Model of Monetary Policy Reaction Function: Evidence from Malaysia," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 48(2), pages 19-27.
    2. Arief Ramayandi, 2011. "Impact of International Financial Shocks on Small Open Economies: The Case of Four ASEAN Countries," ADB Economics Working Paper Series 253, Asian Development Bank.

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    Keywords

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    JEL classification:

    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E43 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Interest Rates: Determination, Term Structure, and Effects

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