Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments December 19, 2022 erstellt
Description:
We investigate how supply chain conditions influence the transmission of monetary policy. Using a nonlinear local projection framework and a new index of supply chain conditions, we find that greater pressure on supply chains amplifies the standard effects of monetary policy on key macroeconomic variables. We argue that this is due to heightened financial frictions. Various measures of credit costs react more strongly to monetary policy when supply chain conditions are tight. The greater sensitivity of external finance premia in the high supply chain pressure state results in financially-constrained firms and households lowering their spending more following a contractionary monetary policy shock