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Christian-Albrechts-Universität Kiel (CAU) >
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Economics Working Papers, Department of Economics, CAU Kiel >
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http://hdl.handle.net/10419/22018
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| Title: | | Anticipated Raw Materials Price Shocks and Monetary Policy Response - A New Keynesian Approach  |
| Authors: | | Winkler, Roland C. Wohltmann, Hans-Werner |
| Issue Date: | | 2006 |
| Series/Report no.: | | Economics working paper / Christian-Albrechts-Universität Kiel, Department of Economics 2006,19 |
| Abstract: | | The paper analyzes the dynamic effects of anticipated raw materials price increases for small open oil-dependent economies and investigates the con- sequences of several monetary policy rules in response to commodity price shocks. Based on a calibrated New Keynesian open economy model the analysis shows that anticipated increases in the price of oil will involve oil- dependent economies both in temporary inflation and deflation as well as in output expansion and contraction. Compared to an interest rate Taylor rule a money growth rule is more appropriate to reduce the volatility of the CPI inflation rate whereas just the opposite holds for stabilizing the output gap. |
| Subjects: | | Oil price shocks Monetary Policy Open Economy |
| JEL: | | E32 E52 F41 Q43 |
| Document Type: | | Working Paper |
| Appears in Collections: | | Economics Working Papers, Department of Economics, CAU Kiel
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