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Monetary Transmission in an Open Economy: The Differential Impact on Exporting and Non-Exporting Firms

Author

Listed:
  • Hedva Ber

    (Bank of Israel)

  • Asher Blass

    (Bank of Israel)

  • Oved Yosha

    (Tel Aviv University)

Abstract

Using firm-level data from the 1990s for publicly traded manufacturing companies in Israel, a liberalized and open economy, we find that monetary policy affects real investment and that the effect operates differentially on the firms in our sample - the greater its export intensity, the less a firm is affected by tight money. We examine several interpretations and conclude that the evidence indicates that the impact is transmitted primarily through the balance sheets of firms whose access to foreign currency funding is relatively constrained.

Suggested Citation

  • Hedva Ber & Asher Blass & Oved Yosha, 2001. "Monetary Transmission in an Open Economy: The Differential Impact on Exporting and Non-Exporting Firms," Bank of Israel Working Papers 2001.01, Bank of Israel.
    • Handle: RePEc:boi:wpaper:2001.01
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    References listed on IDEAS

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    Cited by:

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    2. Masagus M. Ridhwan & Henri L. F. Groot & Piet Rietveld & Peter Nijkamp, 2014. "The Regional Impact of Monetary Policy in Indonesia," Growth and Change, Wiley Blackwell, vol. 45(2), pages 240-262, June.
    3. Harry Aginta & Masakazu Someya, 2022. "Regional economic structure and heterogeneous effects of monetary policy: evidence from Indonesian provinces," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 11(1), pages 1-25, December.
    4. Asher Blass & Sigal Ribon, 2004. "What Determines a Firm's Debt Composition – An Empirical Investigation," Bank of Israel Working Papers 2004.04, Bank of Israel.
    5. Ageliki Anagnostou & Stephanos Papadamou, 2016. "Regional asymmetries in monetary policy transmission: The case of the Greek regions," Environment and Planning C, , vol. 34(5), pages 795-815, August.
    6. Hasan Engin DURAN & Umut ERDEM, 2014. "Regional Effects Of Monetary Policy: Turkey Case," Regional and Sectoral Economic Studies, Euro-American Association of Economic Development, vol. 14(1), pages 133-144.

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