Time Lag of Monetary Policy at Different Interest Rate Stages

DOI

10.2991/aebmr.k.200708.010How to use a DOI?

Keywords

PVAR, impulse response, monetary policy tool output time lag

Abstract

This paper selects the data of 12 major member states of the Eurozone, and uses the PVAR model to compare and analyze the output lag of four kinds of monetary policy instruments: money supply M1, overnight lending rate r, loan balance LOAN and exchange rate e in positive, zero and negative stages. It has reached the following conclusions: First, there are heterogeneity in the output time lag of monetary policy instruments in different interest rate stages, and the longest output lag in the negative interest rate period. Second, the policy effect during the period of negative interest rate is the weakest. Third, the heterogeneity of the output lag of monetary policy instruments at different interest rate stages is due to changes in the transmission channels of monetary policy. Fourth, zero interest rates and negative interest rates threaten financial stability. According to the conclusions, policy suggestions are given for the economic development of our country: firstly, we should adhere to the supply-side reform, focus on returning to the real economy, and improve the return on investment of enterprise through innovation; secondly, we should pay attention to the coordination of fiscal policy and monetary policy when dealing with structural economic problems.

Copyright

© 2020, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Download article (PDF)

TY  - CONF
AU  - Lingjuan Li
PY  - 2020
DA  - 2020/07/09
TI  - Time Lag of Monetary Policy at Different Interest Rate Stages
BT  - Proceedings of the 4th International Symposium on Business Corporation and Development in South-East and South Asia under B&R Initiative (ISBCD 2019)
PB  - Atlantis Press
SP  - 50
EP  - 54
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.200708.010
DO  - 10.2991/aebmr.k.200708.010
ID  - Li2020
ER  -