The impact of monetary policy on New Zealand business cycles and inflation variability

Preprint OPEN
Nathan McLellan; Robert A Buckle; Kunhong Kim;
(2003)
  • Subject: Monetary policy; inflation targeting, business cycles; open economy; structural VAR models; inflation, interest rates, exchange rates, climate; international linkages
    • jel: jel:E32 | jel:E65 | jel:C22 | jel:F41 | jel:E52 | jel:E58

This paper uses the open economy structural VAR model developed in Buckle, Kim, Kirkham, McLellan and Sharma (2002) to evaluate the impact of monetary policy on New Zealand business cycles and inflation variability and the output/inflation variability trade-off. The mod... View more
  • References (7)

    Identifying monetary policy................................................................................... 10

    Contributions to New Zealand growth cycles...................................................... 13 Svensson, Lars (2001), Independent review of the operation of monetary policy in New Zealand: Report to the Minister of Finance, The Institute for International Economic Studies, Stockholm University, Stockholm. February. http://www.treasury.govt.nz/monpolreview/default.htm

    Svensson, Lars (1997), “Inflation targeting in an open economy: Strict or flexible inflation targeting?” Public Lecture, Victoria University of Wellington, November. Reprinted in Victoria Economic Commentaries, March: 15-21.

    Taylor, John B (1993), “Discretion versus policy rules in practice.” Carnegie-Rochester Conference Series on Public Policy 39: 139-214.

    Taylor, John B (1979), “Estimation and control of a macroeconomic model with rational expectations”, Econometrica, 47: 1267 - 1286.

    Tweedie, Andrew J and Grant H Spencer (1981) “Supply behaviour in New Zealand's export industries.” Reserve Bank of New Zealand Research Paper No 31, February.

    Wallace, Richard and Lewis T Evans (1985) “Effects of climate on agricultural production and profit.” Victoria University of Wellington Research Project on Economic Planning, Occasional Paper No 84.

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