Does Monetary Policy Work Effectively In 10 European Countries? New Evidence From Fisher Effect

Ling, Tai-Hu and Liew, Venus Khim-Sen (2013) Does Monetary Policy Work Effectively In 10 European Countries? New Evidence From Fisher Effect. In: Proceedings of the 2nd Applied International Business Conference, 7-8 December 2016, Universiti Malaysia Sabah, Labuan, Malaysia.

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Abstract

This study examines the Fisher effect for 10 European Union countries over a period from January 1987 to December 2012. A battery of panel unit root tests shows that the monthly real interest rates in these countries are mean reverting. The series-specific panel SURADF test of Breuer et al. (2002) reveals that 9 country series reject the unit root null hypothesis, except for 1 country series. These results have one extremely important policy implication is that monetary collaboration within 10 European counties is the key determinant to achieve the long-run macroeconomic stability. Policy makers in European Central Bank need to closely monitor the monetary stability particularly in Luxembourg towards establishing a strong European monetary union.

Item Type: Proceeding (Paper)
Uncontrolled Keywords: real interest rate, panel SURADF, Fisher effect, panel unit root, research, Universiti Malaysia Sarawak, unimas, university, universiti, Borneo, Malaysia, Sarawak, Kuching, Samarahan, ipta, education
Subjects: H Social Sciences > H Social Sciences (General)
Divisions: Academic Faculties, Institutes and Centres > Faculty of Economics and Business
Depositing User: Ab Rahim
Date Deposited: 09 Oct 2017 02:04
Last Modified: 09 Oct 2017 02:04
URI: http://ir.unimas.my/id/eprint/17998

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