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Implications of Globalization for Monetary Policy

  • Helmut Wagner
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    This paper argues that the implications of globalization for monetary policy come mainly through two channels: On the one hand, the many structural changes that are associated with the globalization process cause an increase in the uncertainty surrounding monetary policy. This includes an increase in uncertainty about how to interpret macroeconomic data/indicators and about the monetary transmission mechanism. On the other hand, by strengthening the process of global economic integration, globalization increases international competition, thereby forcing market players to make structural adjustments or reforms that change the conditions or constraints under which monetary policy is implemented.

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    Paper provided by International Monetary Fund in its series IMF Working Papers with number 01/184.

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    Length: 62
    Date of creation: 01 Nov 2001
    Handle: RePEc:imf:imfwpa:01/184
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