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The transmission of monetary policy and technology shocks in the euro area

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  • Nuno Alves
  • Jose Brandao de Brito
  • Sandra Gomes
  • Joao Sousa

Abstract

This article analyses the response of a set of euro area macroeconomic variables to monetary policy and technology shocks based on structural Vector Auto-regressions (VARs). The data set runs from 1970:1 until 2006:4 and includes a novel long-run series for hours worked per capita in the euro area. We find that real macroeconomic variables follow a hump-shaped response after monetary policy shocks and jump on impact after technology shocks. We also provide evidence that hours worked fall after a positive technology shock. These conclusions are robust to different sample periods and specifications of the variables.

Suggested Citation

  • Nuno Alves & Jose Brandao de Brito & Sandra Gomes & Joao Sousa, 2009. "The transmission of monetary policy and technology shocks in the euro area," Applied Economics, Taylor & Francis Journals, vol. 43(8), pages 917-927.
  • Handle: RePEc:taf:applec:v:43:y:2009:i:8:p:917-927
    DOI: 10.1080/00036840802600186
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    Cited by:

    1. Tim Berg, 2012. "Did monetary or technology shocks move euro area stock prices?," Empirical Economics, Springer, vol. 43(2), pages 693-722, October.

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