Global Shocks Alert and Monetary Policy Responses

Shobande, Olatunji and Shodipe, Oladimeji and Simplice, Asongu (2019): Global Shocks Alert and Monetary Policy Responses.

Abstract

The study examines the role of global predictors on national monetary policy formation for Kenya and Ghana within the New Keynesian DSGE framework. We developed and automatically calibrated our DSGE model using the Bayesian estimator, which made our model robust to rigorous stochastic number of subjective choices. Our simulation result indicates that global factors account for the inability of national Central Banks to predict the behaviour of macroeconomic and financial variables among these developing nations.

• Item Type: MPRA Paper
• Language: English
• Keywords: Business Cycle, Macroeconomic policy, Financial crises
• Subjects: E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E32 - Business Fluctuations ; Cycles; E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook > E60 - General

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