The Asymmetric Effects of Monetary Policy on Job Creation and Destruction

Pietro Garibaldi

No 1997/057, IMF Working Papers from International Monetary Fund

Abstract: This paper presents theory and evidence on the asymmetric effects of monetary policy on job creation and job destruction. First, it solves a dynamic matching model and it shows how interest rate changes result in an asymmetric response of job creation and destruction. Second, it looks at how changes in the federal fund rate affect gross job flows in the U.S. manufacturing industry, and it finds evidence of asymmetry. Tight policy increases job destruction and reduces net employment changes. Conversely, easy policy appears ineffective in stimulating job creation.

Keywords: WP; monetary policy; money supply; Transmission of Monetary Policy; Job Creation; Job Destruction; Search Models; net employment change; firm behavior; job flow; reservation productivity; equilibrium unemployment; inflation rate; job creation condition; policy switch; Employment; Productivity; Unemployment; Europe (search for similar items in EconPapers)
Pages: 30
Date: 1997-04-01
References: Add references at CitEc
Citations: View citations in EconPapers (9)

Downloads: (external link)
http://www.imf.org/external/pubs/cat/longres.aspx?sk=2225 (application/pdf)

Related works:
Journal Article: The Asymmetric Effects of Monetary Policy on Job Creation and Destruction (1997)
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:imf:imfwpa:1997/057

Ordering information: This working paper can be ordered from
http://www.imf.org/external/pubs/pubs/ord_info.htm

Access Statistics for this paper

More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC.
Bibliographic data for series maintained by Akshay Modi ().