Bank of Japan’s Quantitative and Credit Easing: Are They Now More Effective?

16 Pages Posted: 2 Feb 2012

See all articles by Pelin Berkmen

Pelin Berkmen

International Monetary Fund (IMF)

Date Written: Janurary 2012

Abstract

This paper asks whether the BoJ’s recent experience with unconventional monetary easing has been effective in supporting economic activity and inflation. Using a structural VAR model, the paper finds some evidence that BoJ’s monetary policy measures during 1998-2010 have had an impact on economic activity but less so on inflation. These results are stronger than those in earlier studies looking at the quantitative easing period up to 2006 and may reflect more effective credit channel as a result of improvements in the banking and corporate sectors. Nevertheless, the relative contribution of monetary policy measures to the variation in output and inflation is rather small.

Keywords: Central banks, Credit, Current account balances, Deflation, Japan, Monetary policy

Suggested Citation

Berkmen, S. Pelin, Bank of Japan’s Quantitative and Credit Easing: Are They Now More Effective? (Janurary 2012). IMF Working Paper No. 12/2, Available at SSRN: https://ssrn.com/abstract=1997715

S. Pelin Berkmen (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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