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Paolo Zagaglia
 
''How reliable are Taylor rules? A view from asymmetry in the U.S. Fed funds rate''
( 2006, Vol. 5 No.14 )
 
 
This note raises the issue of whether asymmetry in estimated monetary-policy rules for the U.S. can be a spurious result due to model specification, rather than a robust feature of the estimated rules themselves. I estimate standard - linear - Taylor rules, and test for conditional symmetry using the procedures presented in Bai and Ng (2001a). The results cast doubt on Taylor rules providing a consistent description of the conduct of the Fed.
 
 
Keywords: conditional symmetry
JEL: E4 - Money and Interest Rates: General
B4 - Economic Methodology: General
 
Manuscript Received : Oct 10 2006 Manuscript Accepted : Oct 12 2006

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