Home > Working Papers

Working Paper 2004-034C

"Using Extraneous Information to Analyze Monetary Policy in Transition Economies"
by William T. Gavin, and David M. Kemme

Empirical macroeconomics is plagued by small sample size and large idiosyncratic variation. This problem is especially severe in the case of the transition economies. We utilize a mixed-estimation method incorporating prior information from OECD country data to estimate the parameters of a reduced-form transition economy model. An exactly identified structural VAR model is constructed to analyze monetary policy in the transition economies. The OECD information increases the precision of the impulse response functions in the transition economies. The method provides a systematic way to analyze monetary policy in the transition economies where data availability is limited.

Full Text - Acrobat PDF (334k)

Notify Me of Updates for:
Category > Monetary Policy/Macroeconomics
Author > William T. Gavin
Research Papers and Publications: JEL Code > C32
Research Papers and Publications: JEL Code > C33
Research Papers and Publications: JEL Code > E52
Research Papers and Publications: JEL Code > F41