Empirical Estimates of Reaction Functions for the Euro Area

摘要: This paper contains a set of estimates reaction functions for the euro area based on monthly data starting in 1985. The main aim is to assess performance Taylor rules and evaluate whether alternative specifications based, inter alia, inclusion additional variables not contained original specification proposed by or use different measures output gap inflation term, can better track interest rate setting area. An interesting result that monetary developments (in form money growth indicator derived as deviation M3 from its estimated reference value) enter significantly an variable Taylor-like policy rule