On the differential impact of monetary policy across states/territories and its determinants in Australia: Evidence and new methodology from a small open economy
AbstractMonetary shocks largely affect economic activity in Western Australia. In smaller proportion, those shocks generate contractions in New South Wales, Victoria and South Australia, while economic activity in Queensland is significantly less affected. Finally, we develop a new approach to uncover the determinants of the differential state/territory responses to monetary shocks. Our estimation validates the theoretical assumptions that differences in industrial composition, exposure to international trade and household debt across states/territories are important determinants of these differences.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 44998.
Date of creation: 10 Jun 2011
Date of revision:
Monetary Policy; VEC; Australian states/territories;
Find related papers by JEL classification:
- E00 - Macroeconomics and Monetary Economics - - General - - - General
- E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
- E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
- E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
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