Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
965936 | Journal of Macroeconomics | 2010 | 15 Pages |
Abstract
Using a fully specified DSGE model, this paper investigates the relationship between a central bank's policy objectives and the stabilization bias. The model is estimated using data from New Zealand. Results indicate that the size of the stabilization bias is nearly twice as large for a small open economy relative to that of closed economies. The results also indicate that the size of the stabilization bias is increasing with respect to the policymaker's preference for exchange rate stabilization.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Philip Liu,