Understanding the Relationship between Financial Development and Monetary Policy

16 Pages Posted: 1 Nov 2010

See all articles by Luis Carranza

Luis Carranza

University of Navarra

Jose E. Galdon-Sanchez

Universidad Publica de Navarra ; IZA

Javier Gomez-Biscarri

affiliation not provided to SSRN

Abstract

In this paper we summarize the results of a broad exploratory empirical analysis where we relate the level of financial development with the effectiveness of monetary policy. The analysis is based on a panel of countries for which we calculate measures both of financial development and of monetary policy effectiveness. We look for statistically significant relationships between the indicators of financial development, the effectiveness coefficients, and other macroeconomic characteristics by estimating dynamic panels and performing a cluster analysis. We present our results in the form of a list of stylized facts that we consider deserve further attention.

Suggested Citation

Carranza, Luis and Galdon-Sanchez, Jose E. and Gomez-Biscarri, Javier, Understanding the Relationship between Financial Development and Monetary Policy. Review of International Economics, Vol. 18, Issue 5, pp. 849-864, November 2010. Available at SSRN: https://ssrn.com/abstract=1699953 or http://dx.doi.org/10.1111/j.1467-9396.2010.00926.x

Luis Carranza (Contact Author)

University of Navarra ( email )

School of Business and Economics
Campus Universitario
Pamplona 31080, Navarra
Spain
+34948425625 (Phone)
+34948425626 (Fax)

Jose E. Galdon-Sanchez

Universidad Publica de Navarra ( email )

Department of Economics
Campus de Arrosadia
Pamplona, Navarra 31006
Spain
+34 948 16 9338 (Phone)
+34 948 16 97 21 (Fax)

HOME PAGE: http://www.econ.unavarra.es/~galdon/

IZA

P.O. Box 7240
Bonn, D-53072
Germany

HOME PAGE: http://www.iza.org/en/webcontent/personnel/photos/index_html?key=1494

Javier Gomez-Biscarri

affiliation not provided to SSRN

No Address Available

Register to save articles to
your library

Register

Paper statistics

Downloads
3
Abstract Views
446
PlumX Metrics