The Monetary Transmission Mechanism: An Empirical Framework
John B. TaylorProfessor of Economics and Director of the Center for Economic Policy Research, Stanford University, Stanford, California
1995en
ABI
Abstract
This paper provides an overview of the monetary transmission mechanism describing the impact of changes in monetary policy on real GDP. Changes in financial market prices--including long-term interest rates and exchange rates--are the main vehicle for the transmission of policy. The framework incorporates rational expectations and policy rules. It is empirical and appears to fit the facts well.
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Cited by 20 references