A Peek Inside the Black Box The Monetary Transmission Mechanism in Japan

This paper uses vector autoregressions to examine the monetary transmission mechanism in Japan. The empirical results indicate that both monetary policy and banks’ balance sheets are important sources of shocks, that banks play a crucial role in transmitting monetary shocks to economic activity, tha...

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Bibliographic Details
Main Author: Bayoumi, Tamim
Other Authors: Morsink, James
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 1999
Series:IMF Working Papers
Subjects:
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
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651 4 |a Japan 
653 |a Credit 
653 |a Banks 
653 |a Finance 
653 |a Banks and banking 
653 |a Industries: Financial Services 
653 |a Intangible Capital 
653 |a Mortgages 
653 |a National accounts 
653 |a Money 
653 |a Bank credit 
653 |a Macroeconomics 
653 |a Banking 
653 |a Capacity 
653 |a Capital 
653 |a Money Multipliers 
653 |a Depository Institutions 
653 |a Investment 
653 |a Private investment 
653 |a Monetary economics 
653 |a Financial institutions 
653 |a Monetary Policy, Central Banking, and the Supply of Money and Credit: General 
653 |a Micro Finance Institutions 
653 |a Money supply 
653 |a Monetary base 
653 |a Loans 
653 |a Saving and investment 
653 |a Banks and Banking 
653 |a Investments: General 
653 |a Money Supply 
653 |a Monetary policy 
653 |a Monetary Policy 
653 |a Money and Monetary Policy 
653 |a Monetary transmission mechanism 
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520 |a This paper uses vector autoregressions to examine the monetary transmission mechanism in Japan. The empirical results indicate that both monetary policy and banks’ balance sheets are important sources of shocks, that banks play a crucial role in transmitting monetary shocks to economic activity, that corporations and households have not been able to substitute borrowing from other sources for a shortfall in bank borrowing, and that business investment is especially sensitive to monetary shocks. We conclude that policy measures to strengthen banks are probably a prerequisite for restoring the effectiveness of the monetary transmission mechanism