Legal Structure, Financial Structure, and the Monetary Policy Transmission Mechanism

Stephen Cecchetti

No 7151, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Among the many challenges facing the new Eurosystem is the possibility that the regions of the euro area will respond differently to interest rate changes. In this essay, I provide evidence that differences in financial structure are the proximate cause for these national asymmetries in the monetary policy transmission mechanism, and that these differences in financial structure are a result of differences in legal structure. My conclusion is that unless legal structures are harmonized across Europe, the financial structures and monetary transmission mechanisms of the European union countries will remain diverse.

JEL-codes: E5 G3 (search for similar items in EconPapers)
Date: 1999-06
New Economics Papers: this item is included in nep-mon and nep-pke
Note: ME
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Citations: View citations in EconPapers (223)

Published as Economic Policy Review of the Federal Reserve Bank of New York, Vol. 5,no. 2 (July 1999): 9-28.

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Chapter: Legal Structure, Financial Structure and the Monetary Policy Transmission Mechanism (2001)
Journal Article: Legal structure, financial structure, and the monetary policy transmission mechanism (1999)
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