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Taylor Rules for the ECB using Expectations Data *
Author(s) -
Gorter Janko,
Jacobs Jan,
De Haan Jakob
Publication year - 2008
Publication title -
scandinavian journal of economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.725
H-Index - 64
eISSN - 1467-9442
pISSN - 0347-0520
DOI - 10.1111/j.1467-9442.2008.00547.x
Subject(s) - economics , inflation (cosmology) , taylor rule , monetary policy , econometrics , interest rate , nominal interest rate , macroeconomics , real interest rate , keynesian economics , central bank , physics , theoretical physics
We estimate Taylor rules for the euro area using Consensus Economics data for expected inflation and output growth, and compare these estimates with more conventional specifications in which actual outcomes are used. We find that the ECB takes expected inflation and expected output growth into account in setting interest rates, while in the more conventional model specification, the coefficient of realized inflation is not significantly different from zero.