Identifying and Estimating the Effects of Unconventional Monetary Policy: How to Do It And What Have We Learned?

Barbara Rossi

No 14064, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: The recent financial crisis led central banks to lower their interest rates in order to stimulate the economy until they hit the zero lower bound. How should one identify monetary policy shocks in unconventional times? Are unconventional monetary policies as effective as conventional ones? And has the monetary policy transmission mechanism changed in the zero lower bound era? This article aims at providing an overview of the econometric challenges and solutions to the identification of monetary policy shocks in unconventional times as well as a survey of their empirical effects on the economy.

Keywords: Shock identification; Vars; Zero lower bound; Unconventional monetary policy; Monetary policy; External instruments; Forward guidance (search for similar items in EconPapers)
JEL-codes: D1 E21 E4 E52 H31 I3 (search for similar items in EconPapers)
Date: 2019-10
New Economics Papers: this item is included in nep-mac and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

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