Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/57353
Authors: 
Bluhm, Marcel
Year of Publication: 
2011
Series/Report no.: 
CFS Working Paper 2011/20
Abstract: 
This paper outlines a new method for using qualitative information to analyze the monetary policy strategy of central banks. Quantitative assessment indicators that are extracted from a central bank's public statements via the balance statistic approach are employed to estimate a Taylor-type rule. This procedure allows to directly capture a policymaker's assessments of macroeconomic variables that are relevant for its decision making process. As an application of the proposed method the monetary policy of the Bundesbank is re-investigated with a new dataset. One distinctive feature of the Bundesbank's strategy consisted of targeting growth in monetary aggregates. The analysis using the proposed method provides evidence that the Bundesbank indeed took into consideration monetary aggregates but also real economic activity and inflation developments in its monetary policy strategy since 1975.
Subjects: 
Monetary Policy Rule
Statement Indicators
Bundesbank
Monetary Targeting
JEL: 
E52
E58
N14
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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