What Drives the Strength of Monetary Policy Transmission?

Jakub Matějů

International Journal of Central Banking, 2019, vol. 15, issue 3, 59-87

Abstract: This paper analyzes the cross-country and time variation in monetary policy transmission from short-term interest rates to price level. Using Bayesian TVP-VAR models where the structural monetary policy shocks are identified using zero and sign restrictions, the results suggest that monetary policy transmission has become stronger over time and sacrifice ratios have decreased. Exploring the cross-country and time variation in monetary policy responses using panel regressions, I show that stronger monetary policy transmission and lower sacrifice ratios were associated with an inflation-targeting regime. In periods of banking crises, the transmission was weaker and output costs were higher.

JEL-codes: C54 E52 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.ijcb.org/journal/ijcb19q3a3.pdf (application/pdf)
http://www.ijcb.org/journal/ijcb19q3a3.htm (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ijc:ijcjou:y:2019:q:3:a:3

Access Statistics for this article

International Journal of Central Banking is currently edited by Loretta J. Mester

More articles in International Journal of Central Banking from International Journal of Central Banking
Bibliographic data for series maintained by Bank for International Settlements ().