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Monetary Policy Regimes and Macroeconomic Outcomes: Hong Kong and Singapore

Stefan Gerlach, Petra Gerlach-Kristen
2006 Social Science Research Network  

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This paper studies the relationship between macroeconomic behaviour and the monetary policy regime in Hong Kong and Singapore, using data for 1984-2004. We estimate an econometric model, comprising a Phillips curve, an IS curve and an equation for changes in the nominal effective exchange rate (NEER), which, in the case of Singapore, can be interpreted as a policy reaction function. The parameter estimates differ in two regards: the NEER responds to inflation in Singapore but not in Hong Kong,
more » ... nd the autoregressive parameter for the output gap in Singapore is smaller than in Hong Kong. Overall, the variability of inflation has been lower in Singapore, but the volatility of real economic activity has been similar in the two economies. JEL Classification Numbers: E31, E32, E58
doi:10.2139/ssrn.900073 fatcat:qbspoppd2nexfps3u33y5oywuy
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Stefan Gerlach, Petra Gerlach-Kristen. "Monetary Policy Regimes and Macroeconomic Outcomes: Hong Kong and Singapore." Social Science Research Network (2006)