Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
9551099 | European Economic Review | 2005 | 27 Pages |
Abstract
This paper studies the monetary transmission mechanism using disaggregated industry data from five industrialized countries. Our goal is to document the cross-industry heterogeneity of monetary policy effects and relate it to industry characteristics suggested by monetary transmission theories. Sizable and significant cross-industry differences in the effects of monetary policy are found. Such differences swamp the hardly detectable cross-country variability. Sectoral output responses to monetary policy shocks are systematically related to the industry output durability, financing requirements, borrowing capacity and firm size. These findings are consistent with a quantitatively non-negligible role of financial frictions in the monetary transmission.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Luca Dedola, Francesco Lippi,