Does monetary policy lose effectiveness during a credit crunch?

Bijapur, Mohan (2010) Does monetary policy lose effectiveness during a credit crunch? Economics Letters, 106 (1). pp. 42-44. ISSN 0165-1765
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This article investigates the effectiveness of monetary policy during a credit crunch by estimating a vector autoregression on the US economy. We present evidence that interest rate cuts have a diminished impact on growth, due to impairment in the relationship between monetary policy and the supply of intermediated credit.
Item Type Article
Copyright holders © 2009 Elsevier B.V.
Keywords credit crunch, monetary policy, transmission mechanism, credit channel
Departments Economics
DOI 10.1016/j.econlet.2009.09.020
Date Deposited 01 May 2014 09:10
URI https://researchonline.lse.ac.uk/id/eprint/56617

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