Tourism income and economic growth in Greece: Empirical evidence from their cyclical components

This paper examines the relationship between the cyclical components of Greek GDP and international tourism income for Greece for the period 1976–2004. Using spectral analysis the authors find that cyclical fluctuations of GDP have a length of about nine years and that international tourism income has a cycle of about seven years. The volatility of tourism income is more than eight times the volatility of the Greek GDP cycle. VAR analysis shows that the cyclical component of tourism income is significantly influencing the cyclical component of GDP in Greece. The findings support the tourism-led economic growth hypothesis and are of particular interest and importance to policy makers, financial analysts and investors dealing with the Greek tourism industry

Nonlinearities in Central Bank of Brazil's reaction function: the case of asymmetric preferences

This paper investigates the existence of possible asymmetries in the Central Bank of Brazil's objectives. By assuming that the loss function is asymmetric with regard to positive and negative deviations of the output gap and of the inflation rate from its target, we estimated a nonlinear reaction function which allows identifying and checking the statistical significance of asymmetric parameters in the monetary authority's preferences. For years 2000 to 2007, results indicate that the Central Bank of Brazil showed asymmetric preference over an above-target inflation rate. Given that this behavior may stem from policy decisions in periods of severe crises (e.g., in 2001 and in 2002), we restricted our sample to the 2004-2007 period. We did not find any empirical evidence of any type of asymmetry in the preferences over the stabilization of inflation and of the output gap for this period.Este trabalho investiga a existência de possíveis assimetrias nos objetivos do Banco Central. Assumindo que a função perda é assimétrica em relação a desvios positivos e negativos do gap do produto e da taxa de inflação em relação à meta, nós estimamos uma função de reação não linear que permite identificar e testar a significância estatística dos parâmetros de assimetrias nas preferências da autoridade monetária. Para o período de 2000-2007, os resultados indicaram que o Banco Central brasileiro apresentou uma preferência assimétrica a favor de uma inflação acima da meta. Visto que este comportamento pode ser decorrente das decisões de política em momentos de fortes crises (tais como as de 2001 e 2002), nós delimitamos a nossa amostra para o período de 2004-2007. Para este período, nós não encontramos evidências empíricas apontando para qualquer tipo de assimetria nas preferências sobre a estabilização da inflação e do gap do produto

Policy rules for inflation targeting

SIGLEAvailable from British Library Document Supply Centre-DSC:3597.9512(1999) / BLDSC - British Library Document Supply CentreGBUnited Kingdo

Financial stability and the Fed

This article retraces how financial stability considerations interacted with US monetary policy before and during the Great Recession. Using text-mining techniques, this article innovates by constructing indicators for financial stability sentiment expressed during testimonies of five Federal Reserve Chairs. Including these text-based measures adds explanatory power to Taylor-rule models. Negative financial stability sentiment coincided with a more accommodative monetary policy stance than implied by standard Taylor-rule factors, even during the decades before the Great Recession. These findings are consistent with a preference for monetary policy reacting to financial instability rather than acting pre-emptively to a perceived build-up of risks

Time and frequency structure of causal correlation networks in the China bond market

There are more than eight hundred interest rates published in China bond market every day. Which are the benchmark interest rates that have broad influences on most interest rates is a major concern for economists. In this paper, multi-variable Granger causality test is developed and applied to construct a directed network of interest rates, whose important nodes, regarded as key interest rates, are evaluated with inverse Page Rank scores. The results indicate that some short-term interest rates have larger influences on the most key interest rates, while repo rates are the benchmark of short-term rates. It is also found that central bank bills'rates are in the core position of mid-term interest rates'network, and treasury bond rates are leading the long-term bonds rates. The evolution of benchmark interest rates is also studied from 2008 to 2014, and it's found that SHIBOR has generally become the benchmark interest rate in China. In the frequency domain we detect the properties of information flows between interest rates and the result confirms the existence of market segmentation in China bond market.Comment: 9 pages, 7 figure