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European Department

Authorized for distribution by Dimitri G. Demekas

Contents

  • I. Introduction

  • II. The Model

    • A. The Benchmark Model

    • B. Policy Rules

  • III. Empirical Analysis

    • A. Data

    • B. Comparative Output and Inflation Results for the EU

    • C. Robustness Analysis: Country Data

    • D. Robustness Analysis: Alternative Measures of the Output Gap

    • E. Robustness Analysis: An Alternative Sample Period—the 1990s

  • IV. Concluding Remarks

  • References

  • Tables

  • 1. GMM Estimates

  • 2. Multivariate (IV) Estimations Under Alternative Policy Rules and Inflation Targets

  • 3. Economic Performance of Policy Rules Under Alternative Inflation Targets (Core Price Data; HP Filter for Output Gap)

  • 4. Economic Performance of Policy Rules Under Alternative Inflation Targets (Germany, France, Spain, and Greece)

  • 5. Economic Performance of Policy Rules Under Alternative Inflation Targets (Core Price Data; SVAR Filter for Output Gap)

  • 6. Economic Performance of Policy Rules Under Alternative Inflation Targets (Core Price Data: OECD Output Gap Measures-1980-2002

  • 7. Economic Performance of Policy Rules Under Alternative Inflation Targets during the 1990s

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Inflation Targeting and Output Growth: Empirical Evidence for the European Union
Author:
International Monetary Fund