The Monetary Transmission Mechanism in the Tropics
AbstractMany central banks in low-income countries in Sub-Saharan Africa are modernising their monetary policy frameworks. Standard statistical procedures have had limited success in identifying the channels of monetary transmission in such countries. Here we take a narrative approach, following Romer and Romer (1989), and center on a significant tightening of monetary policy that took place in 2011 in four members of the East African Community: Kenya, Uganda, Tanzania and Rwanda. We find clear evidence of the transmission mechanism in most of the countries, and argue that deviations can be explained by differences in the policy regime in place.
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Bibliographic InfoPaper provided by International Monetary Fund in its series IMF Working Papers with number 13/197.
Date of creation: 20 Sep 2013
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This paper has been announced in the following NEP Reports:
- NEP-AFR-2013-10-05 (Africa)
- NEP-ALL-2013-10-05 (All new papers)
- NEP-CBA-2013-10-05 (Central Banking)
- NEP-MON-2013-10-05 (Monetary Economics)
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