INFLATION TARGETING AND AN OPTIMAL TAYLOR RULE FOR AN OPEN ECONOMY: EVIDENCE FOR COLOMBIA 1990-2011*

dc.creator	VILLA,EDGAR
dc.creator	MISAS,MARTHA A
dc.creator	GIRALDO,ANDRÉS F
dc.date	2014-05-01
dc.date.accessioned	2019-04-25T12:42:03Z
dc.date.available	2019-04-25T12:42:03Z
dc.identifier	https://scielo.conicyt.cl/scielo.php?script=sci_arttext&pid=S0719-04332014000100002
dc.identifier.uri	http://revistaschilenas.uchile.cl/handle/2250/61307
dc.description	An optimal monetary policy Taylor rule is developed for an open economy, which we then estimate following a Markov regime-switching model for quarterly data from Colombia during 1990-2011. We find two opposite monetary regimes characterized by different policy rules: until October 2000 the Central Bank of Colombia reacted only statistically to output gap changes while after October 2000, when inflation targeting was officially adopted, monetary policy reacted only statistically to changes in the inflation rate. The latter regime is consistent with the Taylor principle as shown analytically and verified empirically by a unit root test for a Markov regime-switching model.
dc.format	text/html
dc.language	en
dc.publisher	Pontificia Universidad Católica de Chile. Instituto de Economía.
dc.relation	10.7764/LAJE.51.1.41
dc.rights	info:eu-repo/semantics/openAccess
dc.source	Latin american journal of economics v.51 n.1 2014
dc.subject	Optimal Taylor rule
dc.subject	inflation targeting
dc.subject	Taylor principle
dc.subject	Markov switching
dc.title	INFLATION TARGETING AND AN OPTIMAL TAYLOR RULE FOR AN OPEN ECONOMY: EVIDENCE FOR COLOMBIA 1990-2011*