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Measuring Inflation Pressure and Monetary Policy Response: A General Approach Applied to US Data 1966 - 2001

Author

Listed:
  • Diana N. Weymark

    (Department of Economics, Vanderbilt University)

  • Mototsugu Shintani

    (Department of Economics, Vanderbilt University)

Abstract

We propose a methodology for constructing operational indices of inflation pressure, the monetary authority's effort to reduce this pressure, and the degree to which inflation pressure is alleviated. We begin with model independent definitions of these concepts. When our definitions are applied to a specific model we obtain model-specific functional forms for these indices. We apply our methodology to a micro-founded aggregate model with rational expectations. GMM estimates of the model are used to obtain quarterly time series of our indices for the United States from 1966 to 2001.

Suggested Citation

  • Diana N. Weymark & Mototsugu Shintani, 2004. "Measuring Inflation Pressure and Monetary Policy Response: A General Approach Applied to US Data 1966 - 2001," Vanderbilt University Department of Economics Working Papers 0424, Vanderbilt University Department of Economics.
    • Handle: RePEc:van:wpaper:0424
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    References listed on IDEAS

    as
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    Cited by:

    1. Pierre L. Siklos & Diana N. Weymark, 2008. "Data Revisions, Gradualism, and US Inflation Pressure in Real Time," Vanderbilt University Department of Economics Working Papers 0816, Vanderbilt University Department of Economics.
    2. Pierre L. Siklos & Diana N. Weymark, 2009. "Has Inflation Targeting Improved Monetary Policy? Evaluating Policy Effectiveness in Australia, Canada, and New Zealand," Vanderbilt University Department of Economics Working Papers 0906, Vanderbilt University Department of Economics.

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    More about this item

    Keywords

    Inflation pressure; monetary policy; stabilization policy;
    All these keywords.

    JEL classification:

    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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