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Measuring Monetary Policy and Pass-Through in Chile

Author

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  • Héctor Bravo L.
  • Carlos García T.

Abstract

First, this paper reviews the most important literature based on money VAR, which explains monetarytransmission mechanisms and pass-through from depreciation to inflation in Chile and other countries. Second, it estimates three structural VAR models with short-run restrictions and one VEC with long-run restrictions. The results indicate that monetary-transmission has become less powerful in the last years than in the period 1986-1997 and that the low pass-through depends on economic activity, inflation and the inflation target.

Suggested Citation

  • Héctor Bravo L. & Carlos García T., 2002. "Measuring Monetary Policy and Pass-Through in Chile," Journal Economía Chilena (The Chilean Economy), Central Bank of Chile, vol. 5(3), pages 5-28, December.
  • Handle: RePEc:chb:bcchec:v:5:y:2002:i:3:p:5-28
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    References listed on IDEAS

    as
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