MEASURING MONETARY POLICY SHOCKS

ABSTRACT. Fielding and Shields remark that an increase in the share of wholesale and retail firms in total employment is associated with greater sensitivity to monetary policy shocks. Using a structural VAR approach, Sousa and Zaghini find that after a monetary policy shock output declines temporarily, with the downward effect reaching a peak within the second year, and the global monetary aggregate drops significantly. When a set of consumption goods is nontraded and the consumption basket is distinct across countries, Duarte shows that the model is consistent with the observed relative price differentials across countries under a fixed exchange rate regime.