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Measuring and Mending Monetary Policy Effectiveness Under Capital Account Restrictions :, Lessons from Mauritania, Robert Blotevogel

I propose a new approach to identifying exogenous monetary policy shocks in low-income countries with capital account restrictions. In the case of Mauritania, a domestic repatriation requirement is the key institutional characteristic that allows me to establish exogeneity. Unlike in advanced countries, I find no evidence for a statistically significant impact of exogenous monetary policy shocks on bank lending. Using a unique bank-level dataset on monthly balance sheets of six Mauritanian banks over the period 2006–11, I estimate structural vector autoregressions and two-stage least square panel models to demonstrate the ineffectiveness of monetary policy. Finally, I discuss how a reduction in banks’ loan concentration ratios and improvements in the liquidity management framework could make monetary stimuli more effective
Table Of Contents
Cover; Contents; I. Introduction; II. Overview of Recent Developments in Bank Lending; III. Indentifying Exogenous Shocks in Mauritania's Monetary Policy Framework; A. The monetary policy framework; B. The monetary policy stance and economic developments; C. Exogenous monetary policy shocks; IV. Empirical Results; A. Data; B. Vector autoregressions; C. 2SLS panels with fixed effects; V. Policy Considerations; A. Loan concentration; B. Liquidity management framework; VI. Conclusion; References; Tables; 1. Granger Causality Tests; 2. Private-sector Creditor Using Reserves
Literary Form
non fiction
Description based upon print version of record
Physical Description
1 online resource (36 p.)
Specific Material Designation
Form Of Item

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