IDEAS home Printed from https://ideas.repec.org/p/imf/imfwpa/1999-137.html
   My bibliography  Save this paper

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

Author

Listed:
  • Mr. Tamim Bayoumi
  • Mr. James Morsink

Abstract

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.

Suggested Citation

  • Mr. Tamim Bayoumi & Mr. James Morsink, 1999. "A Peek Inside the Black Box: The Monetary Transmission Mechanism in Japan," IMF Working Papers 1999/137, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:1999/137
    as

    Download full text from publisher

    File URL: http://www.imf.org/external/pubs/cat/longres.aspx?sk=3293
    Download Restriction: no
    ---><---

    Other versions of this item:

    More about this item

    Keywords

    WP; broad money; interest rate; call rate; demand; bank loan; Monetary transmission mechanism; bank behavior; broad money shock; private demand; overnight call rate; interest rate shock; bank weakness; interest rate channel; Bank credit; Monetary base; Private investment; Loans; Asia and Pacific;
    All these keywords.

    JEL classification:

    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:imf:imfwpa:1999/137. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Akshay Modi (email available below). General contact details of provider: https://edirc.repec.org/data/imfffus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.