An EMU with Different Transmission Mechanisms
We develop and compute a dynamic equilibrium model where economies differ on the relative efficiency of financial intermediaries and, therefore on households portfolios and currency holdings. Our model economies have some of the features of the different financial structures in countries of the European Union and respond to monetary shocks in a way similar to the observed responses, which we also estimate. It follows that if differences on the relative efficiency of financial intermediaries persist in a monetary union, conflicts of interests in the pursuit of a common monetary policy can arise.
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References listed on IDEAS
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- Fernando Barran & Virginie Coudert & Benoît Mojon, 1996. "The Transmission of Monetary Policy in the European Countries," Working Papers 1996-03, CEPII research center.
- Bagliano, Fabio C. & Favero, Carlo A., 1998.
"Measuring monetary policy with VAR models: An evaluation,"
European Economic Review,
Elsevier, vol. 42(6), pages 1069-1112, June.
- Fabio C. Bagliano & Carlo A. Favero, "undated". "Measuring Monetary Policy with VAR Models: an Evaluation," Working Papers 132, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
- Bagliano, Fabio-Cesare & Favero, Carlo A., 1997. "Measuring Monetary Policy with VAR Models: An Evaluation," CEPR Discussion Papers 1743, C.E.P.R. Discussion Papers.