Evaluating Exchange Rate Management: An Application to Korea

摘要: This paper uses data-rich estimation techniques to study monetary policy in an open economy. We apply the a small, forward-looking model and explore importance of exchange rate rule. approach allows us discern whether authority targets per se, or instead simply responds order achieve its other objectives. The also removes downward bias on estimate extent inflation targeting. find that this is important case Korea, de jure targeter. In contrast previous studies, our findings suggest Bank Korea actively inflation, not rate. Apparently, has been only indirectly Korea's policy.