Financial conditions and nonlinearities in the European Central Bank (ECB) reaction function: In-sample and out-of-sample assessment

2012 ◽  
Vol 56 (1) ◽  
pp. 173-189 ◽  
Author(s):  
Costas Milas ◽  
Ruthira Naraidoo
Keyword(s):  
Central Bank ◽  
European Central Bank ◽  
Reaction Function ◽  
European Central ◽  
Financial Conditions ◽  
Out Of Sample

Estimating the ECB Policy Reaction Function

2006 ◽  
Vol 7 (1) ◽  
pp. 1-34 ◽  
Author(s):  
Kai Carstensen
Keyword(s):  
Monetary Policy ◽  
Interest Rate ◽  
Central Bank ◽  
European Central Bank ◽  
Probit Model ◽  
Ordered Probit ◽  
Reaction Function ◽  
Baseline Model ◽  
European Central ◽  
Policy Reaction Function

Abstract This paper estimates the policy reaction function of the European Central Bank in the first four years of EMU using an ordered probit model which accounts for the fact that central bank rates are set at multiples of 25 basis points. Starting from a baseline model which mimics the Taylor rule, the impacts of different economic variables on interest rate decisions are analysed. It is concluded that the monetary growth measure which was announced by the ECB as the first pillar of their monetary strategy does not play an outstanding role for the actual interest rate decisions. More sophisticated measures like the money overhang which uses information from both pillars are better suited. Overall, it is concluded that the revision of the monetary policy strategy in May 2003 which implied a downgrading of the first pillar will not induce any observable changes in monetary policy decisions.

Crisis, austerity and water

2017 ◽  
Author(s):  
Fred Powell
Keyword(s):  
Welfare State ◽  
South Korea ◽  
Central Bank ◽  
European Commission ◽  
International Monetary Fund ◽  
European Central Bank ◽  
Social Crisis ◽  
European Central ◽  
Financial Conditions ◽  
The Impact

This chapter examines the impact of the 2008 crash on the Irish welfare state. The 2008 crash seriously damaged Ireland's reputation. Once bracketed with Taiwan and South Korea in terms of the strength of its economy, it now found itself compared to the sick men of Europe — Portugal, Italy and Greece. A bailout was provided by the ‘troika’ of the European Commission/ International Monetary Fund/European Central Bank with penal financial conditions, which came to be popularly known as ‘austerity’. The failure of the Irish welfare state to protect children indicates social priorities that seriously deviate from the norms of international children's rights. Austerity turned these welfare deficits into a full-blown social crisis.

Was für eine Europäische Verfassung?

2005 ◽  
Vol 35 (139) ◽  
pp. 287-300 ◽  
Author(s):  
Étienne Balibar
Keyword(s):  
Central Bank ◽  
European Central Bank ◽  
Social Rights ◽  
European Constitution ◽  
Fundamental Level ◽  
European Central

The problem of a European Constitution is discussed at a fundamental level. In which way, can we speak about such a Constitution? Thearticle argues against the “postnational souveranism”, legitimating state against citizens. A new kind of citizenship is favoured based on extended social rights. The constitution now proposed contrarily makes the European Central Bank and its neoliberal policy to central and nearly unchangeable institution.

Dramatis Institutiones

2017 ◽  
Author(s):  
C. Randall Henning
Keyword(s):  
European Union ◽  
Central Bank ◽  
International Monetary Fund ◽  
Euro Area ◽  
European Central Bank ◽  
The European Union ◽  
European Central ◽  
Regime Complex ◽  
Basic Facts ◽  
Institutional Conflict

The regime complex for crisis finance in the euro area included the European Council, Council of the European Union, and Eurogroup in addition to the three institutions of the troika. As the member states acted largely, though not exclusively, through the council system, these bodies stood at the center of the institutional mix. This chapter reviews the institutions as a prelude to examining the dilemmas that confronted them over the course of the crises. It presents a brief review of some of the basic facts about their origins, membership, and organization. Each section then delves more deeply into these institutions’ governance and principles to understand their capabilities and strategic challenges. As a consequence of different mandates and design, the European Commission, European Central Bank, and International Monetary Fund diverged with respect to their approach to financing, adjustment, conditionality, and debt sustainability. This divergence set the stage for institutional conflict in the country programs.

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