TY  - JOUR
AU  - Clarida, Richard
AU  - Gertler, Mark
TI  - How the Bundesbank Conducts Monetary Policy
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 5581
PY  - 1996
Y2  - May 1996
DO  - 10.3386/w5581
UR  - http://www.nber.org/papers/w5581
L1  - http://www.nber.org/papers/w5581.pdf
N1  - Author contact info:
Richard H. Clarida
Columbia University
420 West 118th Street
Room 1111, IAB
New York, NY  10027
Tel: 212/854-3676
Fax: 212/854-8059
E-Mail: rhc2@columbia.edu

Mark Gertler
Department of Economics
New York University
269 Mercer Street, 7th Floor
New York, NY 10003
Tel: 212/998-8931
Fax: 212/995-4186
E-Mail: mark.gertler@nyu.edu
M1  - published as Richard H. Clarida, Mark Gertler. "How the Bundesbank Conducts Monetary Policy," in Christina D. Romer and David H. Romer, Editors, "Reducing Inflation: Motivation and Strategy" University of Chicago Press (1997)

AB  - This paper analyzes German monetary policy in the post-Bretton Woods era.  Despite the public focus on monetary targeting, in practice, German monetary policy involves the management of short term interest rates, as it does in the United States.  Except during the mid to late 1970s, the Bundesbank has aggressively adjusted interest rates to achieve and maintain low inflation.  The performance of the real economy, however, also influences its decision-making.  Our formal analysis suggests that the Bundesbank has adjusted short term interest rates according to a modified version of the feedback rule that Taylor (1994) has used to characterize the behavior of the Federal Reserve Board under Alan Greenspan.
ER  -