Olivo, Victor (2018): An Empyrical Analysis of Price Stickiness in Five Latin American Inflation Targeters:2000-2016.
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Abstract
The main objective of this study is to examine empirically the assumption of price stickiness in five Latin American countries that have implemented inflation targeting schemes during the period under study 2000-2016. These countries are Brazil, Chile, Colombia, Mexico, and Peru. The study adopts a macroeconomic approach suggested by McCallum (1989, 1996) that in turn follows a methodology proposed by Barro (1977, 1978, 1981), and Barro and Rush (1980). An important contribution of this paper is that it separates monetary shocks in two categories: M1 shocks and policy rate shocks. Both types of shocks exhibit durable effects on real output, though in general, M1 surprises tend to be more persistent than policy rate surprises.
| Item Type: | MPRA Paper |
|---|---|
| Original Title: | An Empyrical Analysis of Price Stickiness in Five Latin American Inflation Targeters:2000-2016 |
| Language: | English |
| Keywords: | Keywords: price stickiness, rational expectations, monetary policy, policy rate shocks, M1 shocks. |
| Subjects: | E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E31 - Price Level ; Inflation ; Deflation E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E32 - Business Fluctuations ; Cycles E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E52 - Monetary Policy E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E58 - Central Banks and Their Policies |
| Item ID: | 88589 |
| Depositing User: | Victor Olivo |
| Date Deposited: | 26 Aug 2018 07:04 |
| Last Modified: | 02 Oct 2019 22:13 |
| References: | Barro, Robert J. (1977). Unanticipated Money Growth and Unemployment in the United States. American Economic Review 67. Barro, Robert J. (1978). Unanticipated Money, Output, and the Price Level in the United States. Journal of Political Economy 86. Barro, Robert J. (1981). Unanticipated Money Growth and Economic Activity in the United States. Published in Money, Expectations, and Business Cycles. Essays in Macroeconomics, ed. Robert J. Barro. Academic Press. Barro, Robert J. and Mark Rush (1980). Unanticipated Money and Economic Activity. Published in Rational Expectations and Economic Policy, ed. Stanley Fischer. University of Chicago Press for National Bureau of Economic Research. Fischer, Stanley (1981). Long-Term Contracts, Rational Expectations, and the Optimal Money Supply Rule. Published in Rational Expectations and Econometric Practice, eds. Robert E. Lucas Jr. and Thomas J.Sargent.The University of Minnesota Press. McCallum, Bennett T. (1989). Monetary Economics: Theory and Policy. Third edition. McMillan Publishing Company. McCallum, Bennett T. (1996). International Monetary Economics. Oxford University Press. Olivo, Víctor T. (2016). Estabilidad de Precios en América Latina: ¿Ya llegamos Allí? Munich Personal RePEc Archive. Taylor, John B. (1979). Staggered Wage Setting in a Macro Model. American Economic Review Papers and Proceedings 69. Taylor, John B. (1980). Aggregate Dynamics and Staggered Contracts. Journal of Political Economy 88. |
| URI: | https://mpra.ub.uni-muenchen.de/id/eprint/88589 |
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