Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/22018
Authors: 
Winkler, Roland C.
Wohltmann, Hans-Werner
Year of Publication: 
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

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