Belke, Ansgar; Freytag, Andreas; Keil, Jonas; Schneider, Friedrich:
The Credibility of Monetary Policy Announcements: Empirical Evidence for OECD Countries since the 1960s
2012
In: DIW Diskussionspapiere = Discussion Papers / Deutsches Institut für Wirtschaftsforschung, Heft 1225, S. 1 - 23
Artikel/Aufsatz in Zeitschrift / Fach: Wirtschaftswissenschaften
Fakultät für Wirtschaftswissenschaften » Fachgebiet Volkswirtschaftslehre » Makroökonomik
Titel:
The Credibility of Monetary Policy Announcements: Empirical Evidence for OECD Countries since the 1960s
Autor(in):
Belke, Ansgar im Online-Personal- und -Vorlesungsverzeichnis LSF anzeigen; Freytag, Andreas; Keil, Jonas; Schneider, Friedrich
Erscheinungsjahr:
2012
Erschienen in:
DIW Diskussionspapiere = Discussion Papers / Deutsches Institut für Wirtschaftsforschung, Heft 1225, S. 1 - 23
ISSN:
Link URL:

Abstract:

Monetary policy rules have been considered as fundamental protection against inflation. However, empirical evidence for a correlation between rules and inflation is relatively weak. In this paper, we first discuss likely causes for this weak link and present the argument that monetary commitment is not credible in itself. It can grant price stability best if it is backed by an adequate assignment of economic policy. An empirical assessment based on panel data covering five decades and 22 OECD countries confirms the crucial role of a credibly backed monetary commitment to price stability.