IDEAS home Printed from https://ideas.repec.org/p/rba/rbardp/rdp9008.html
   My bibliography  Save this paper

Financial Deregulation and the Monetary Transmission Mechanism

Author

Listed:
  • Jerome Fahrer

    (Reserve Bank of Australia)

  • Tom Rohling

    (Reserve Bank of Australia)

Abstract

Major changes to the Australian financial system occurred in the 1980s that were potentially important for the effects of monetary policy on economic activity. Using vector autoregressive econometric techniques we find that, in fact, the deregulation of the financial system has made very little difference to the reduced form relationships between interest rates, employment growth, inflation and the growth rate of real credit. We find that interest rates are an important determinant of both the business cycle and inflation, with credit being much less influential. We also find that monetary policy reacts to unexpected movements in real variables but does not react to unexpected changes in the rate of inflation.

Suggested Citation

  • Jerome Fahrer & Tom Rohling, 1990. "Financial Deregulation and the Monetary Transmission Mechanism," RBA Research Discussion Papers rdp9008, Reserve Bank of Australia.
    • Handle: RePEc:rba:rbardp:rdp9008
    as

    Download full text from publisher

    File URL: https://www.rba.gov.au/publications/rdp/1990/9008.html
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Carolyn Currie, 2003. "Towards a General Theory of Financial Regulation: Predicting, Measuring and Preventing Financial Crises," Working Paper Series 132, Finance Discipline Group, UTS Business School, University of Technology, Sydney.
    2. Currie, Carolyn, 2006. "A new theory of financial regulation: Predicting, measuring and preventing financial crises," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 35(1), pages 48-71, February.
    3. Phil Bodman, "undated". "Are the Effects of Monetary Policy Asymmetric in Australia?," MRG Discussion Paper Series 0406, School of Economics, University of Queensland, Australia.

    More about this item

    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:rba:rbardp:rdp9008. 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: Paula Drew (email available below). General contact details of provider: https://edirc.repec.org/data/rbagvau.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.