Financial Globalization, Output Gap and Foreign Output Gap on inflation: Evidenced from Developing Economies

Speed Limit and Asymmetric Inflation Effects from the Output Gap in the Major Seven Economies

Asymmetric effects from positive and negative output gaps on inflation . '. . . . . . . 63 Allowing for possible mismeasurement of the gap . . . . . . . . . . . . . . . . . . . . . . . 64 An illustrative example . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66 Summary and policy implications. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....

Globalization , the Output - Inflation Tradeoff , and Inflation

Interest rate and output gap: Does central bank credibility matter?

This paper studies the effects of central bank credibility on nominal interest rate and output gap on 17 inflation targeting (IT) developing countries using Instrument Variables (IV) over a period that spans 24 years (1996-2019). In the first stage, using new Keynesian model is obtained “Credibility loss” index to measure the importance of central bank past performance and its deviation from it...

Stylised facts from output gap measures

This paper compares three models of the output gap in New Zealand – the Reserve Bank of New Zealand’s incumbent MV filter, estimates from a Structural VAR, and a multivariate unobserved components model – and investigates whether there are features that are consistent across the measures of the gap. Various detrending methods are used for benchmarking the output gap measures, including a linear...

The Output Gap and Optimal Monetary Policy

In a standard New Keynesian model, a discretionary and myopic central bank concerned with changes in the output gap and inßation will implement a monetary policy that replicates the optimal, timeless perspective, precommitment policy. By stabilizing output gap changes, the central bank imparts inertia into output and inßation that is absent under pure discretion. It is shown that even a fully o...