The Monetary Transmission in the US and the Euro Area: Common Features and Common Frictions
This paper compares the monetary transmission mechanism in the US and the 3 largest economies of the euro area. We start by showing that the dynamic responses to a monetary policy shock in each of the four countries are analogous. A model with a small set of frictions that broadly accounts for these responses is then presented. The model incorporates nominal wage contracts, habits for preferences in consumption and the staggered adjustment of households. portfolios. A common characterization of the monetary transmission mechanism in the US and the main euro area countries is therefore attainable.
|Date of creation:||2004|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: 21 321 32 00
Fax: 21 346 48 43
Web page: http://www.bportugal.pt
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Mark Bils & Peter J. Klenow, 2002.
"Some Evidence on the Importance of Sticky Prices,"
NBER Working Papers
9069, National Bureau of Economic Research, Inc.
- Erceg, Christopher J. & Henderson, Dale W. & Levin, Andrew T., 2000.
"Optimal monetary policy with staggered wage and price contracts,"
Journal of Monetary Economics,
Elsevier, vol. 46(2), pages 281-313, October.
- Ryo Kato & Takayuki Tsuruga, 2002. "Matlab code for a sticky wage/price model," QM&RBC Codes 114, Quantitative Macroeconomics & Real Business Cycles.
- Christopher J. Erceg & Dale W. Henderson & Andrew T. Levin, 1999. "Optimal monetary policy with staggered wage and price contracts," International Finance Discussion Papers 640, Board of Governors of the Federal Reserve System (U.S.).
- Andrew Levin & Christopher J. Erceg & Dale W. Henderson, 1999. "Optimal Monetary Policy with Staggered Wage and Price Contracts," Computing in Economics and Finance 1999 1151, Society for Computational Economics.
- Tom Doan, . "RATS program to solve Erceg-Henderson-Levin model," Statistical Software Components RTZ00051, Boston College Department of Economics.
- Ciccarelli, Matteo & Rebucci, Alessandro, 2004.
"Has the Transmission Mechanism of European Monetary Policy Changed in the Run-Up to EMU?,"
CEPR Discussion Papers
4535, C.E.P.R. Discussion Papers.
- Ciccarelli, Matteo & Rebucci, Alessandro, 2006. "Has the transmission mechanism of European monetary policy changed in the run-up to EMU?," European Economic Review, Elsevier, vol. 50(3), pages 737-776, April.
- Fuerst, Timothy S., 1992. "Liquidity, loanable funds, and real activity," Journal of Monetary Economics, Elsevier, vol. 29(1), pages 3-24, February.
- Douglas Gollin, 2002.
"Getting Income Shares Right,"
Journal of Political Economy,
University of Chicago Press, vol. 110(2), pages 458-474, April.
- Lawrence J. Christiano & Martin Eichenbaum & Charles L. Evans, 1997.
Working Paper Series, Macroeconomic Issues
WP-97-17, Federal Reserve Bank of Chicago.
- Lawrence J. Christiano & Jonas D. M. Fisher, 2003. "Stock Market and Investment Goods Prices: Implications for Macroeconomics," NBER Working Papers 10031, National Bureau of Economic Research, Inc.
- Amato, Jeffery D. & Laubach, Thomas, 2003. "Estimation and control of an optimization-based model with sticky prices and wages," Journal of Economic Dynamics and Control, Elsevier, vol. 27(7), pages 1181-1215, May.
- Ignazio Angeloni & Anil K. Kashyap & Benoit Mojon & Daniele Terlizzese, 2003. "Monetary Transmission in the Euro Area: Does the Interest Rate Channel Explain it All?," NBER Working Papers 9984, National Bureau of Economic Research, Inc.
- Rochelle Edge & Thomas Laubach, 2003. "The Optimal Monetary Policy Response to Shifts in Trend MFP Growth: A DGE Analysis," Computing in Economics and Finance 2003 93, Society for Computational Economics.
- Mojon, Benoît & Peersman, Gert, 2001. "A VAR description of the effects of monetary policy in the individual countries of the euro area," Working Paper Series 0092, European Central Bank.
When requesting a correction, please mention this item's handle: RePEc:ptu:wpaper:w200414. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (DEE-NTDD)
If references are entirely missing, you can add them using this form.