Industry Effects of Monetary Policy: Evidence from India
AbstractThe study exploits 2-digit level industry data for the period 1981-2004 to ascertain the interlinkage between a monetary policy shock and industry value added. Accordingly, we first estimate a Vector Auto Regression (VAR) model to ascertain the magnitude of a monetary policy shock on industrial output. Subsequently, we try to explain the observed heterogeneity in terms of industry characteristics. The findings indicate that (a) industries exhibit differential response to a monetary tightening and (b) both interest rate and financial accelerator variables tend to be important in explaining the differential response.
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Bibliographic InfoArticle provided by Department of Economics, Delhi School of Economics in its journal Indian Economic Review.
Volume (Year): 44 (2009)
Issue (Month): 1 (July)
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Postal: University of Delhi, Delhi 110 007
Phone: 91-11-2766-6533/34/35, 2766-6703/04/05
Web page: http://www.ierdse.org/
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Other versions of this item:
- Ghosh, Saibal, 2009. "Industry Effects of Monetary Policy: Evidence from India," MPRA Paper 17307, University Library of Munich, Germany.
- E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
- L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
- P20 - Economic Systems - - Socialist Systems and Transition Economies - - - General
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