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Unvealing Monetary Policy Transmission on Inflation Targeting Economies: The Wealth-Consumption Channel

Juan Andres Espinosa Torres; Sebastian Sanin Restrepo () and Sebastian Sanin-Restrepo ()
Authors registered in the RePEc Author Service: Juan Andrés Espinosa Torres () and Sebastian Sanin Restrepo, Sr.

No 17012, Vniversitas Económica from Universidad Javeriana - Bogotá

Abstract: This paper test the presence of the consumption-wealth channel on the trans- mission of monetary policy on economies following the Inflation Targeting (IT) framework. Combining a Structural Vector Autoregression (SVAR) method-ology and a policy counterfactual exercise, this channel is modelled for 27economies divided into four implementing window dates: first, early, inter-mediate and recent implementers. Results show that effects derived from this channel are most significant for those economies that implemented IT earlier, with some particular exceptions among the other groups. This suggest that long-run stability and definition of IT regimes play a significant role to make monetary policy transmit to the economy.

Keywords: monetary policy transmission; inflation targeting; asset prices. (search for similar items in EconPapers)
JEL-codes: E31 E42 E52 (search for similar items in EconPapers)
Pages: 26
Date: 2018-11-26
New Economics Papers: this item is included in nep-cba, nep-mac and nep-mon
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Handle: RePEc:col:000416:017012