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The monetary transmission mechanism in the euro area: more evidence from VAR analysis

Author

Listed:
  • Peersman, Gert
  • Smets, Frank
Abstract
This paper applies the identified VAR methodology to synthetic euro area data from 1980 till 1998 to study the macro-economic effects of an unexpected change in monetary policy in the euro area. The focus is on the area-wide monetary transmission. It is shown that the overall macro-economic effects of a monetary policy shock in the euro area are very similar to those estimated for the United States and are surprisingly stable over time. In addition, the paper contains a number of robustness checks with alternative identification schemes and examines how various real and financial variables (such as the GDP or money components) respond to an area-wide monetary policy impulse JEL Classification: E52

Suggested Citation

  • Peersman, Gert & Smets, Frank, 2001. "The monetary transmission mechanism in the euro area: more evidence from VAR analysis," Working Paper Series 91, European Central Bank.
    • Handle: RePEc:ecb:ecbwps:200191
    Note: 58657
    as

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    References listed on IDEAS

    as
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    More about this item

    Keywords

    monetary transmission mechanism; vector autoregressions;

    JEL classification:

    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy

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