Taylor rule in Brazil

Detalhes bibliográficos
Autor(a) principal: Bueno, Rodrigo de Losso da Silveira
Data de Publicação: 2005
Tipo de documento: Relatório
Idioma: eng
Título da fonte: Repositório Institucional do FGV (FGV Repositório Digital)
Texto Completo: http://hdl.handle.net/10438/13391
Resumo: 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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spelling 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/pdf253188https://repositorio.fgv.br/bitstreams/a1b4c3ba-cb9d-46eb-b171-6a6bb57f6dff/download7fc2ab6ffc2097d034d075c34661ebaaMD51LICENSElicense.txtlicense.txttext/plain; charset=utf-84707https://repositorio.fgv.br/bitstreams/c67987ac-ee03-41a9-b528-adc10d8a7368/downloaddfb340242cced38a6cca06c627998fa1MD52TEXTDe Losso - Taylor Rule in Brazil.pdf.txtDe Losso - Taylor Rule in Brazil.pdf.txtExtracted 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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.
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