The Choice of Monetary Policy and Its Relevance for Economic Performance: Empirical Evidence from a Global Perspective
The Choice of Monetary Policy and Its Relevance for Economic Performance: Empirical Evidence from a Global Perspective

Summary/Abstract: Monetary policy is considered to be one of the most important public policies influencing not only the level of prices in economy, the volatility of exchange rates or interest rates, but also the structure of production of goods and services. This paper analyses the importance of monetary policy for economic growth and for macroeconomic (in)stability using a newly built database with original information collected by the authors. It provides an empirical illustration of the relationship between the declared objectives and targets of monetary policy in different countries and their economic performance (measured by GDP growth rate, GDP per capita and other indicators) through a discriminant analysis framework.

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