Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/19481
Authors: 
Kamada, Koichiro
Year of Publication: 
2004
Series/Report no.: 
Discussion paper Series 1 / Volkswirtschaftliches Forschungszentrum der Deutschen Bundesbank 2004,14
Abstract: 
This paper examines the methods used by the Bank of Japan for the estimation of the output gap. Attention is paid to the real-time estimation problem. After reviewing the evolution of output gap estimation at the Bank, I discuss advantages and disadvantages of the various output gap measures. First, I examine the usefulness of the output gap for inflation forecasting and show that the real-time output gap sometimes includes much noise. Second, I investigate the implications of the real-time estimation problem for the policy evaluation. Third, I exploit TANKAN to enhance the usefulness of the real-time output gap.
Subjects: 
output gap
real-time estimation
inflation forecasting
Taylor Rule
JEL: 
E31
E32
E52
E58
Document Type: 
Working Paper

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