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The Monetary Transmission Mechanism: Evidence from the Industry Data of Five OECD Countries

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  • Luca Dedola

    (Banca d'Italia)

  • Francesco Lippi

    (Banca d'Italia)

Abstract

This paper collects new evidence on the monetary transmission mechanism. This evidence is obtained from the study of the effects that unexpected monetary policy shocks exert on the activity of the manufacturing sectors in 5 OECD countries (France, Germany, Italy, UK and USA). The goal is twofold. First, to document the cross-industry heterogeneity of monetary policy effects. Second, to explain this heterogeneity in terms of some industry characteristics which are suggested by theory. The results highlight a wide variation of the policy effects across industries. It is shown that these differences can be partly explained by industrial features pointed to both by the interest rate channel (e.g. the durability of the output produced in each industry) and by the credit channel (e.g. the borrowing capacity of firms').

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Bibliographic Info

Paper provided by Econometric Society in its series Econometric Society World Congress 2000 Contributed Papers with number 1833.

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Date of creation: 01 Aug 2000
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Handle: RePEc:ecm:wc2000:1833

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  1. Bernd Hayo, 1999. "Industry Effects of Monetary Policy in Germany," Macroeconomics 9906009, EconWPA.
  2. Stephen G. Cecchetti, 1999. "Legal structure, financial structure, and the monetary policy transmission mechanism," Economic Policy Review, Federal Reserve Bank of New York, issue Jul, pages 9-28.
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Citations

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Cited by:
  1. Saibal Ghosh, 2009. "Industry Effects of Monetary Policy: Evidence from India," Indian Economic Review, Department of Economics, Delhi School of Economics, vol. 44(1), pages 89-105, July.
  2. Magdalena Morgese Borys & Roman Horvath, 2007. "The Effects of Monetary Policy in the Czech Republic: An Empirical Study," CERGE-EI Working Papers wp339, The Center for Economic Research and Graduate Education - Economic Institute, Prague.
  3. Mojon, Benoît & Kashyap, Anil K. & Angeloni, Ignazio & Terlizzese, Daniele, 2002. "Monetary Transmission in the Euro Area : Where Do We Stand?," Working Paper Series 0114, European Central Bank.
  4. Gert Peersman & Frank Smets, 2005. "The Industry Effects of Monetary Policy in the Euro Area," Economic Journal, Royal Economic Society, vol. 115(503), pages 319-342, 04.
  5. repec:onb:oenbwp:y:2006:i:1:b:1 is not listed on IDEAS
  6. Matteo Ciccarelli & Alessandro Rebucci, 2002. "The Transmission Mechanism of European Monetary Policy: Is There Heterogeneity? Is it Changing over Time?," IMF Working Papers 02/54, International Monetary Fund.
  7. Chi, Li-Chiu, 2009. "Contagion and competitive effects of plan confirmation of reorganization filings: Evidence from the Taiwan Stock Market," Economic Modelling, Elsevier, vol. 26(2), pages 364-369, March.
  8. Andreas Worms, 2003. "Interbank Relationships and the Credit Channel in Germany," Empirica, Springer, vol. 30(2), pages 179-198, June.
  9. Fabio Bagliano & Alessandro Sembenelli, 2004. "The cyclical behaviour of inventories: European cross-country evidence from the early 1990s recession," Applied Economics, Taylor & Francis Journals, vol. 36(18), pages 2031-2044.
  10. Paul Mizen & Cihan Yalcin, 2006. "Monetary Policy, Corporate Financial Composition and Real Activity," CESifo Economic Studies, CESifo, vol. 52(1), pages 177-213, March.
  11. I. Arnold & C.J.M. Kool & K. Raabe, 2005. "The determinants of the industry effects of US monetary policy," Working Papers 05-11, Utrecht School of Economics.
  12. Worms, Andreas, 2001. "The reaction of bank lending to monetary policy measures in Germany," Working Paper Series 0096, European Central Bank.

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