An analysis of the national monetary policy from the viewpoint of the New Macroeconomic Consensus
DOI:
https://doi.org/10.4013/pe.2011.72.04Abstract
The article aims to synthesize ideas of different authors belonging to the so-called New Consensus Macroeconomics (NCM) and elaborate the formal structure that can demonstrate the real consensus of these ideas. This study also intents to analyze the national monetary policy in the light of the NCM school precepts. The paper presents a brief summary of the main works belonging to the formal field of NCM and a formal structure of the NCM. The formal NCM models, in the context of the closed economy, include three basic equations: an IS curve, a Phillips curve and a Rule o fMonetary Policy Conduction (Reaction Function of the Central Bank). The reaction function of the Central Bank was used to verify the appropriateness of Brazil’s monetary policy to the NCM ideas. In order to do that, econometric instruments were used and statistic data of the Brazilian economy (from July 2001 to December 2009) was analzysed. The main results demonstrate that the national monetary policy conduction appeared to fit partially into the basic precepts of the New Consensus Macroeconomics.
Keywords: New Macroeconomic Consensus, monetarypolicy, response function of the Central Bank.
GEL Classification: E50; E52.
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