The performance of monetary policy : a comparison between civil-law and common-law countries
The objective of this paper is to compare the effectiveness of monetary policy between civillaw countries and common-law countries by investigating the impulse response of monetary policy actions on the level of output. This is to determine whether countries of common-law origin are less sensitive t...
| Main Author: | |
|---|---|
| Format: | Article |
| Language: | English English |
| Published: |
Faculty of Management and Human Resource Developemant
2007
|
| Subjects: | |
| Online Access: | http://eprints.utm.my/8137/ http://eprints.utm.my/8137/1/ZukarnainZakaria2007_ThePerformanceofMonetaryPolicy.pdf http://eprints.utm.my/8137/2/24-bil-09-jun-2007.html |
| Summary: | The objective of this paper is to compare the effectiveness of monetary policy between civillaw countries and common-law countries by investigating the impulse response of monetary policy actions on the level of output. This is to determine whether countries of common-law origin are less sensitive to monetary policy actions compared with civil-law countries. Theoretically, we expected that monetary policy is more effective in civil-law countries where their financial structures are more bank-based as compared to common-law countries where their financial structures are more market-based. The impulse response functions were generated through the estimation of first-differences VAR consisting of five variables. The findings show the impact of monetary policy is relatively stronger, responds more quickly and long lasting in civil-law countries compared with common-law countries. |
|---|