758 - Nonlinear monetary policy in Europe: fact or myth?

Wetenschappelijke publicatie
Date 1 June 2004

We hold the fort for linear specification of monetary policy and economic activity in Europe. Using data on the last two and a half decades we cannot reject the hypothesis that monetary policy is a linear process and we find mixed results regarding economic activity. JEL Code: C51 Key words: Time series model specification; Linearity tests; Nonlinear models