00000caa a22000003i 4500 UP-1685594773862408639 Buklod 20210406134745.0 m | | ta 210406s2007 xx a r |||| u|eng d 1655-1516 (iLib)UPBAG-00039679797 BAG rda eng ARTICLE-2969 Angeles, Rj F. author. The contribution of the output gap to the conduct of inflation targeting in the Philippines RJ Angeles and Margot Aissa Tan. 2007. pages [99]-123 illustrations 25 cm text rdacontent unmediated rdamedia volume rdacarrier Title was 'Philippine Review of Business and Economics' until 1979. Title changed to 'Philippine Review of Economics and Business' from 1980-2000, and again changed to 'Philippine Review of Economics' since 2001. Includes bibliographical references (pages 119-123). This paper evaluates whether the inclusion of the output gap in the central bank's estimated reaction function would improve the conduct of inflation targeting in the Philippines. A reduced-form vector autoregression model was constructed using exchange rate, output gap, inflation, and interest rate as the relevant variables. The authors use two measures for the short-term interest rate: the reverse repurchase rate and the T-bill rate. Results from counterfactual simulations show that the adoption of a Taylor-type rule, which involves the use of the output gap, minimizes the deviations of inflation from its target. Based on the empirical results of this study, the inclusion of the output gap is significant in terms of its contribution to maintaining inflation at a level that is nearer to the desired target. It is recommended that further studies consider the use of output gap estimates derived from other procedures, especially those that employ Markov-regime switching techniques, which could account for shocks in the economy. In addition, the use of alternative model-representations for the Philippine economy within which counterfactual simulations may be performed is recommended as an area for future research. Inflation (Finance) Philippines. Inflation (Finance) Philippines Mathematical models. Monetary policy Philippines. Tan, Margot Aissa C. author. The Philippine Review of Economics Vol. XLIV, No. 1 (June 2007), p. [99]-123. Request full-text access via UPB University Library through https://forms.gle/KZjBv7aRtY6jiL5E9 (viewed 06 April 2021) UPBAG UPBAG-MAIN ARTICLE-2969 Analytics