Affiliation:
1. Monetary Policy Department Reserve Bank of India Mumbai India
2. Department of Economic and Policy Research Reserve Bank of India Mumbai India
Abstract
AbstractDo the different types of financial friction have differential implications for monetary transmission in emerging economies? We investigate this question using India as the country for analysis. We adopt a New Keynesian business cycle model with bank intermediation, extend it by the Indian economy‐specific features and validate with the data. The baseline model explains the co‐movements of interest rates, incomplete pass‐through and sluggish adjustment mechanism of the macro‐financial variables for a policy interest rate shock. It identifies the collateral‐constrained, financially excluded households and low proportion of savers as the primary sources of frictions causing weak monetary transmission.
Subject
Economics, Econometrics and Finance (miscellaneous),Economics and Econometrics
Reference44 articles.
1. Anand R. Delloro V. &Peiris S. J.(2014).A credit and banking model for emerging markets and an application to the Philippines. InThe evolving role and limits of monetary policy: New perspectives for emerging market economies 2014 BSP international research conference Proceedings Bangko Sentral ng Pilipinas International research conference Manila Philippines(pp.191–230). published in Issue No. 2.
2. Anand R. Peiris S. &Saxegaard M.(2010).An estimated model with macrofinancial linkages for India. IMF Working Paper No. WP/10/21.International Monetary Fund.
3. Financial frictions and the strength of monetary transmission
4. TECHNOLOGY SHOCKS AND BUSINESS CYCLES IN INDIA
Cited by
3 articles.
订阅此论文施引文献
订阅此论文施引文献，注册后可以免费订阅5篇论文的施引文献，订阅后可以查看论文全部施引文献