@techreport{Golinelli2002Monetary,
abstract = {In 1991, the rate of inflation in the Czech Republic, Hungary and Poland was
between 35% and 70%. At the end of 2001, it is below 8%. We setup a small
structural macro model of these economies to explain the process of disinflation.
Contrary to a widespread skepticism, which permeated a large part of previous
research on these issues, we show that a simple open macroeconomic model, along
the lines of Svensson (2000, Journal of International Economics), with forwardlooking
inflation and exchange rate expectations, can adequately characterize the
relationship between the output gap, inflation, the real interest rate and the exchange
rate during the course of transition.
We use the estimated models to interpret the main features of monetary policy in
each country and identify the channels of policy transmission. We characterize the
policy rules and assess the relative importance of the interest rate channel (on
aggregate demand) and the exchange rate channel (which affects both aggregate
demand and supply) in determining the path of (dis)inflation. In the same context, we
also tentatively analyze the consequences of attempting a faster path of disinflation.
Finally, we evaluate the appropriateness of the inflation targeting framework which
has been adopted recently in all three countries, and discuss to what extent it
represents a discontinuity with the past.},
author = {Roberto Golinelli and Riccardo Rovelli},
copyright = {http://www.econstor.eu/dspace/Nutzungsbedingungen},
keywords = {F41; E52; E31; P24; 330; Disinflation policy; Interest rate rules; Inflation targeting; Transition economies; Small open-economy macro models; Transmissionsmechanismus; Inflationsbek\"{a}mpfung; Inflation Targeting; Zinspolitik; \"{U}bergangswirtschaft; Kleines-offenes-Land; Tschechische Republik; Ungarn; Polen},
language = {eng},
number = {10},
title = {Monetary Policy Transmission, Interest Rate Rules and Inflation Targeting in Three Transition Countries},
type = {Ezoneplus working paper},
url = {http://hdl.handle.net/10419/22126},
year = {2002}
}
