Taylor rule in Brazil
Main Author: | |
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Publication Date: | 2005 |
Format: | Report |
Language: | eng |
Source: | Repositório Institucional do FGV (FGV Repositório Digital) |
Download full: | http://hdl.handle.net/10438/13391 |
Summary: | In this paper, we use the Taylor Rule to characterize empirically the Brazilian monetary policy before and after its major and succesful stabilization plan, Real Plan, launched in 1994. Specifically, we show how the inflation coefficient has changed after the stabilization plan was carried out. This is a natural experiment to test theories surrounding the Taylor Rule in which monetary instability is characterized by an inflation coefficient less than one, whereas monetary stability will have a greater than one coefficient (seeWoodford’s (2003)). Very suprisingly the paper shows that the inflation coefficient has remained less than one even after the stabilization. Our results are quite robust with respect to different samples, lags of variables, proxies for GDP, proxies for potential GDP and even with respect to econometric methods (see Bueno (2005a, 2005b)). The implications are very important both theoretically and empirically. First, it shows some gap in theory that deserves further investigation. Second, it suggests that the inflation targeting regime has been uneffective in Brazil confirming a feeling largerly spread among Brazilians. |
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Bueno, Rodrigo de Losso da SilveiraEscolas::EAESP2015-02-23T17:51:51Z2015-02-23T17:51:51Z2005http://hdl.handle.net/10438/13391In this paper, we use the Taylor Rule to characterize empirically the Brazilian monetary policy before and after its major and succesful stabilization plan, Real Plan, launched in 1994. Specifically, we show how the inflation coefficient has changed after the stabilization plan was carried out. This is a natural experiment to test theories surrounding the Taylor Rule in which monetary instability is characterized by an inflation coefficient less than one, whereas monetary stability will have a greater than one coefficient (seeWoodford’s (2003)). Very suprisingly the paper shows that the inflation coefficient has remained less than one even after the stabilization. Our results are quite robust with respect to different samples, lags of variables, proxies for GDP, proxies for potential GDP and even with respect to econometric methods (see Bueno (2005a, 2005b)). The implications are very important both theoretically and empirically. First, it shows some gap in theory that deserves further investigation. Second, it suggests that the inflation targeting regime has been uneffective in Brazil confirming a feeling largerly spread among Brazilians.engRelatório de pesquisa FGV/EAESP/NPP;n.28Taylor rulePrice stabilityInflation targetingAdministração de empresasTaylor, Regra deTaylor rule in Brazilinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/reportreponame:Repositório Institucional do FGV (FGV Repositório Digital)instname:Fundação Getulio Vargas (FGV)instacron:FGVinfo:eu-repo/semantics/openAccessORIGINALDe Losso - Taylor Rule in Brazil.pdfDe Losso - Taylor Rule in Brazil.pdfapplication/pdf253188http://bibliotecadigital.fgv.br:80/dspace/bitstream/10438/13391/1/De%20Losso%20-%20Taylor%20Rule%20in%20Brazil.pdf7fc2ab6ffc2097d034d075c34661ebaaMD51LICENSElicense.txtlicense.txttext/plain; charset=utf-84707http://bibliotecadigital.fgv.br:80/dspace/bitstream/10438/13391/2/license.txtdfb340242cced38a6cca06c627998fa1MD52TEXTDe Losso - Taylor Rule in Brazil.pdf.txtDe Losso - Taylor Rule 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dc.title.eng.fl_str_mv |
Taylor rule in Brazil |
title |
Taylor rule in Brazil |
spellingShingle |
Taylor rule in Brazil Bueno, Rodrigo de Losso da Silveira Taylor rule Price stability Inflation targeting Administração de empresas Taylor, Regra de |
title_short |
Taylor rule in Brazil |
title_full |
Taylor rule in Brazil |
title_fullStr |
Taylor rule in Brazil |
title_full_unstemmed |
Taylor rule in Brazil |
title_sort |
Taylor rule in Brazil |
author |
Bueno, Rodrigo de Losso da Silveira |
author_facet |
Bueno, Rodrigo de Losso da Silveira |
author_role |
author |
dc.contributor.unidadefgv.por.fl_str_mv |
Escolas::EAESP |
dc.contributor.author.fl_str_mv |
Bueno, Rodrigo de Losso da Silveira |
dc.subject.eng.fl_str_mv |
Taylor rule Price stability |
topic |
Taylor rule Price stability Inflation targeting Administração de empresas Taylor, Regra de |
dc.subject.por.fl_str_mv |
Inflation targeting |
dc.subject.area.por.fl_str_mv |
Administração de empresas |
dc.subject.bibliodata.por.fl_str_mv |
Taylor, Regra de |
description |
In this paper, we use the Taylor Rule to characterize empirically the Brazilian monetary policy before and after its major and succesful stabilization plan, Real Plan, launched in 1994. Specifically, we show how the inflation coefficient has changed after the stabilization plan was carried out. This is a natural experiment to test theories surrounding the Taylor Rule in which monetary instability is characterized by an inflation coefficient less than one, whereas monetary stability will have a greater than one coefficient (seeWoodford’s (2003)). Very suprisingly the paper shows that the inflation coefficient has remained less than one even after the stabilization. Our results are quite robust with respect to different samples, lags of variables, proxies for GDP, proxies for potential GDP and even with respect to econometric methods (see Bueno (2005a, 2005b)). The implications are very important both theoretically and empirically. First, it shows some gap in theory that deserves further investigation. Second, it suggests that the inflation targeting regime has been uneffective in Brazil confirming a feeling largerly spread among Brazilians. |
publishDate |
2005 |
dc.date.issued.fl_str_mv |
2005 |
dc.date.accessioned.fl_str_mv |
2015-02-23T17:51:51Z |
dc.date.available.fl_str_mv |
2015-02-23T17:51:51Z |
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http://hdl.handle.net/10438/13391 |
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dc.language.iso.fl_str_mv |
eng |
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eng |
dc.relation.ispartofseries.por.fl_str_mv |
Relatório de pesquisa FGV/EAESP/NPP;n.28 |
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openAccess |
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