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ECB’ Negative Interest Rate Monetary Policy Effects On Domestic Investment and Economic Growth in Euroarea and Bulgaria

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  • Anika Petkova

    (University of National and World Economy, Sofia, Bulgaria)

Abstract

There are sufficient changes in monetary policy after the beginning of the economic crisis since 2007. We have witnessed a transition from conventional to unconventional monetary policy, and instruments used are highly discretionary and stimulating. The negative interest rate policy (NIRP) leads to contradictory results for different economies. During 2008 – 2019 significant growth in investment activity in the Eurozone and in Bulgaria is not observed and therefore there are not high and sustainable economic growth rates, which are one of the main goals of the unconventional monetary policy. Possible explanation of aforementioned negative developments in investment incentives and in economic activity steam from uncertainty and mistrust of investors, which are further exacerbated by various geopolitical disruptions in international trade movements.

Suggested Citation

  • Anika Petkova, 2020. "ECB’ Negative Interest Rate Monetary Policy Effects On Domestic Investment and Economic Growth in Euroarea and Bulgaria," Nauchni trudove, University of National and World Economy, Sofia, Bulgaria, issue 5, pages 205-217, December.
    • Handle: RePEc:nwe:natrud:y:2020:i:5:p:205-217
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    More about this item

    Keywords

    monetary policy; interest rate; investment activity; economic growth; international trade;
    All these keywords.

    JEL classification:

    • E1 - Macroeconomics and Monetary Economics - - General Aggregative Models
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E4 - Macroeconomics and Monetary Economics - - Money and Interest Rates
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
    • F3 - International Economics - - International Finance

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