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Legal Structure, Financial Structure and the Monetary Policy Transmission Mechanism

In: The Monetary Transmission Process

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  • Stephen G. Cecchetti

Abstract

Over the past decade, the countries of central Europe have become more alike in many ways. As the new members of the European Monetary Union (EMU) prepared for the birth of the Euro on 1 January 1999, their economic policies became substantially more uniform. All eleven countries in the new Euro Area had virtually eliminated inflation and taken serious steps toward fiscal consolidation.2 As their monetary and fiscal policies have adjusted to meet these common goals, the countries’ business cycle fluctuations appear to have become more synchronised as well.3 While this makes the job of the European System of Central Banks (ESCB) easier, numerous difficult challenges remain. Primary among these is the making of policy in the face of the possibility that it will have differential impacts across the countries of the Euro Area.

Suggested Citation

  • Stephen G. Cecchetti, 2001. "Legal Structure, Financial Structure and the Monetary Policy Transmission Mechanism," Palgrave Macmillan Books, in: Deutsche Bundesbank (ed.), The Monetary Transmission Process, chapter 5, pages 170-207, Palgrave Macmillan.
  • Handle: RePEc:pal:palchp:978-0-230-59599-6_6
    DOI: 10.1057/9780230595996_6
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    References listed on IDEAS

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    4. R. Glenn Hubbard, 1994. "Is There a `Credit Channel' for Monetary Policy?," NBER Working Papers 4977, National Bureau of Economic Research, Inc.
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    16. R. Glenn Hubbard, 1995. "Is there a \"credit channel\" for monetary policy?," Proceedings, Federal Reserve Bank of St. Louis, issue May, pages 63-77.
    17. Gertler, Mark & Gilchrist, Simon, 1993. " The Role of Credit Market Imperfections in the Monetary Transmission Mechanism: Arguments and Evidence," Scandinavian Journal of Economics, Wiley Blackwell, vol. 95(1), pages 43-64.
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    More about this item

    Keywords

    European Union; Monetary Policy; Banking System; Euro Area; European Central Bank;
    All these keywords.

    JEL classification:

    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
    • G3 - Financial Economics - - Corporate Finance and Governance

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