What s Different about Monetary Policy Transmission in Remittance Dependent Countries is popular PDF and ePub book, written by Mr.Adolfo Barajas in 2016-03-01, it is a fantastic choice for those who relish reading online the Business & Economics genre. Let's immerse ourselves in this engaging Business & Economics book by exploring the summary and details provided below. Remember, What s Different about Monetary Policy Transmission in Remittance Dependent Countries can be Read Online from any device for your convenience.
What s Different about Monetary Policy Transmission in Remittance Dependent Countries Book PDF Summary
Despite welfare and poverty-reducing benefits for recipient households, remittance inflows have been shown to entail macroeconomic challenges; producing Dutch Disease-type effects through their upward (appreciation) pressure on real exchange rates, reducing the quality of institutions, delaying fiscal adjustment, and ultimately having an indeterminate effect on long-run growth. The paper explores an additional challenge, for monetary policy. Although they expand bank balance sheets, providing a stable flow of interest-insensitive funding, remittances tend to increase banks’ holdings of liquid assets. This both reduces the need for an interbank market and severs the link between the policy rate and banks’ marginal costs of funds, thus shutting down a major transmission channel. We develop a stylized model based on asymmetric information and a lack of transparent borrowers and undertake econometric analysis providing evidence that increased remittance inflows are associated with a weaker transmission. As independent monetary policy becomes impaired, this result is consistent with earlier findings that recipient countries tend to favor fixed exchange rate regimes.
Detail Book of What s Different about Monetary Policy Transmission in Remittance Dependent Countries PDF
- Author : Mr.Adolfo Barajas
- Release : 01 March 2016
- Publisher : International Monetary Fund
- ISBN : 9781513531106
- Genre : Business & Economics
- Total Page : 41 pages
- Language : English
- PDF File Size : 19,7 Mb
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