Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/153205
Authors: 
Podpiera, Jirí
Year of Publication: 
2007
Series/Report no.: 
ECB Working Paper 771
Abstract: 
Policymakers do not always follow a simple rule for setting policy rates for various reasons and thus their choices are co-driven by a decision to follow a rule or not. Consequently, some observations are censored and cause bias in conventional estimators of typical Taylor rules. To account for the censored and discrete process of policy rate setting, I devise a new method for monetary policy rule estimation and demonstrate its ability to outperform the existing conventional estimators using two examples.
Subjects: 
Bias in parameters
monetary policy
policy rule
JEL: 
E4
E5
Document Type: 
Working Paper

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