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A Model of Rule-of-Thumb Consumers With Nominal Price and Wage Rigidities

This document presents a dynamic stochastic general equilibrium model with rule of thumb (Non-Ricardian) agents and both nominal price and wage rigidities. The model follows closely that of Galí et al. (2004) and expands it to include a second way form of heterogeneity (besides the Non-Ricardian...

An Early Warning Model for Predicting Credit Booms Using Macroeconomic Aggregates

In this paper, we propose an alternative methodology to determine the existence of credit booms, which is a complex and crucial issue for policymakers. In particular, we exploit the Mendoza and Terrones (2008)’s idea that macroeconomic aggregates other than the credit growth rate contain...

An Early Warning Model for Predicting Credit Booms Using Macroeconomic Aggregates

In this paper, we propose an alternative methodology to determine the existence of credit booms, which is a complex and crucial issue for policymakers. In particular, we exploit the Mendoza and Terrones’s (2008) idea that macroeconomic aggregates contain valuable information to...

An Estimation of the Nonlinear Phillips Curve in Colombia

An Estimation Of the Nonlinear Phillips Curve in Colombia An Estimation Of the Neonlinear Phillips Curve in Colombia



Javier Gómez and Juan Manuel Julio  */

Bayesian Model Estimation and Selection for the Weekly Colombian Exchange Rate

Bayesian Model Estimation and Selection for the Colombian Exchange Rate Bayesian Model Estimation and Selection for the Colombian
Exchange Rate



Norberto Rodríguez Niño  */

Colombia's Public Finance in the 1990s: a Decade of Reforms, fiscal Imbalance, and Debt

Commodity Price Fluctuations, Core Inflation and Policy Interest Rates

The world economy has recently been hit by commodity price fluctuations, with first round effects on noncore inflation and second round effects on core inflation. The policy response to commodity price fluctuations depends on the first and second round effects as well as on the strength of the...

Constant-Interest-Rate Projections and Its Indicator Properties

This paper propose indicator variables for the implementation of monetary policy in an inflation targeting regime. Using constant interest rate projections, the notion of a target-compatible interest rate is presented. This variable allows to extract some characteristics that the expected future...

Finance neutral potential output: an evaluation on an emerging market monetary policy context

In this paper output gaps that include financial cycle information are evaluated against models used in policy analysis by the Colombian central bank. Employing this dataset is no trivial matter, since policy related models are the only relevant yardstick, and emerging economies (such as...

Financial Inefficiency and Real Business Cycle in Colombia

Financial Inefficiency and Real Business Cycle in Colombia


Financial Inefficiency and Real Business Cycle in Colombia
     Camilo Zea*

Foreign Exchange Intervention in Colombia

Banco de la República’s FX intervention policy is described, with a focus on its objectives and main features. Then, based on a survey of the effectiveness of sterilized intervention in Colombia, it is argued that this tool is not useful to cope with the challenges posed by medium term external...

Inflation Expectations and a Model-Based Core Inflation Measure in Colombia

Inflation expectations in Colombia are characterized. Empirical evidence following conventional tests suggests that they might not be rational, although the period of disinflation included in the sample makes it difficult to ascertain this conclusion. Inflation expectations display close ties...

Monetary policy implications for an oil-exporting economy of lower long-run international oil prices

The sudden collapse of oil prices poses a challenge to inflation targeting central banks in oil exporting economies. This paper illustrates that challenge and conducts a quantitative assessment of the impact of permanent changes in oil prices in a small and open economy, in which oil represents...

Short Run Savings Fluctuations and Export Shocks. Theory and Evidence for Latin-America

A basic theoretical of a small open economy within the framework of intertemporal maximization is used to analyze the effects of nominal export shocks. The model helps in explaining the close relationship that is found between export shocks and short run fluctuations of domestic savings in the...

State-dependent Forward Guidance and the Problem of Inconsistent Announcements

Florez-Jimenez and Parra-Polania (2016) show that unconditional forward guidance (FG) performs poorly except in the most extreme zero lower-bound (ZLB) events and that for any ZLB situation it is better to resort to state-dependent (threshold-based) FG. The model of that paper is solved under...

The Fan Chart: The Technical Details of the New Implementation

Our current implementation of the Fan Chart follows the original Britton Fisher and Whitley [2] and Blix and Sellin [1] proposal in which the inputs enter at the fourth and ninth quarters and are distributed within the forecasting horizon according to pre established weights. This procedure does...

The Implementation of Inflation Targeting in Colombia

The natural interest rate in Latin America America

 

The opinions contained in this document are the sole responsibility of the authors and do not commit Banco de la Republica or its Board of Directors.

 

 

Transmission Mechanisms and Inflation Targeting: The Case of Colombia's Disinflation

Transmission mechanisms and inflation targeting: the case of Colombia’s desinflation

Volatility Spillovers and Systemic Risk Across Economies: Evidence from a Global Semi-Structural Model

Abstract: The paper presents some evidence on the overwhelming relevance of systemic risk and the lesser importance of US interest rates in the global transmission of shocks. This evidence suggests that the literature could benefit from incorporating global confidence variables...

This content has been translated into English for informational purposes. Upon any query regarding its interpretation or enforceability, the Spanish version shall be deemed official, and will prevail over the English version. The authors of specific texts such as working papers or articles select the language of publication; therefore, there might be cases in which the content may only be available in English.