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Monetary Transmission (monetary + transmission)

Distribution by Scientific Domains
Business, Economics, Finance and Accounting100%

Terms modified by Monetary Transmission

  • monetary transmission mechanism
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    Selected Abstracts

    Monetary Transmission and Inventory: Evidence from Japanese Balance-Sheet Data by Firm Size

    THE JAPANESE ECONOMIC REVIEW, Issue 4 2002
    Kazuo Ogawa
    I analyse the response of inventories and short-term debts to monetary policy using disaggregated data on Japanese manufacturing firms classified by firm size. I find that monetary contraction decreases the inventories of large firms; however, inventories of small and medium firms increase considerably for the first several quarters. This implies that in a subcontracting system small and medium subcontractors serve as a buffer and alleviate the monetary shocks felt by their large parent firms. Moreover, inventory build-ups are financed by increases in accounts payable. I also find that for small firms land asset is important in easing credit conditions and increasing inventories. JEL Classification Numbers: E22, E32, E44, E51. [source]

    Firm Size, Industry Mix and the Regional Transmission of Monetary Policy in Germany

    GERMAN ECONOMIC REVIEW, Issue 1 2004
    Ivo J. M. Arnold
    Monetary transmission; regional effects; industry effects; firm size Abstract. This paper estimates the impact of interest rate shocks on regional output in Germany over the period from 1970 to 2000. We use a vector autoregression (VAR) model to obtain impulse responses, which reveal differences in the output responses to monetary policy shocks across ten German provinces. Next, we investigate whether these differences can be related to structural features of the regional economies, such as industry mix, firm size, bank size and openness. An additional analysis of the volatility of real GDP growth for the period 1992,2000 includes the Eastern provinces. We also present evidence on the interrelationship between firm size and industry, and compare our measure of firm size with those used in previous studies. We conclude that the differential regional effects of monetary policy are related to industrial composition, but not to firm size or bank size. [source]

    MONETARY TRANSMISSION MECHANISM IN CENTRAL AND EASTERN EUROPE: SURVEYING THE SURVEYABLE

    JOURNAL OF ECONOMIC SURVEYS, Issue 2 2009
    Balázs Égert
    Abstract This paper surveys recent advances in empirical studies of the monetary transmission mechanism, with special attention to Central and Eastern Europe (CEE). Our results indicate that the strength of the exchange rate pass-through substantially declined over time mainly due to a fall in inflation rates and to some extent due to the so-called composition effect. The asset price channel is weak and is likely to remain weak because of shallow stock and private bond markets and because of low stock and bond holdings of domestic households. House prices may become an exception with booming mortgage lending and with high owner occupancy ratios. While the credit channel could be a powerful channel of monetary transmission , as new funds raised on capital markets are close to zero in CEE , it is actually not, as both commercial banks and non-financial corporations can escape domestic monetary conditions by borrowing from their foreign mother companies. The moderately good news, however, is that those banks and firms are influenced by monetary policy in the euro area because their parent institutions are themselves subjected to the credit channel in the euro area. [source]

    Optimal Monetary Policy with an Uncertain Cost Channel

    JOURNAL OF MONEY, CREDIT AND BANKING, Issue 5 2009
    PETER TILLMANN
    parameter uncertainty; min,max; cost channel; optimal monetary policy; Taylor rule The cost channel of monetary transmission describes a supply-side effect of interest rates on firms' costs. Previous research has found this effect to vary, both over time and across countries. Moreover, the cyclical nature of financial frictions is likely to amplify the cost channel. This paper derives optimal monetary policy in the presence of uncertainty about the true size of the cost channel. In a min,max approach, the central bank derives an optimal policy plan to be implemented by a Taylor rule. It is shown that uncertainty about the cost channel leads to an attenuated interest rate setting behavior. In this respect, the Brainard (1967) principle of cautious policy in the face of uncertainty continues to hold in both a Bayesian and a min,max framework. [source]