Beschreibung:
In this paper, we revisit the debate on the effects of monetary policy shocks in the U.S. economy. In a recent study, Gertler and Karadi (2015) suggest that movements in credit costs help to capture the transmission mechanism of monetary policy to the aggregate economy through the credit channel. Using their proxy structural vector autoregression framework, we find that once the Volcker disinflation period is left out and one focuses on the post-mid-1980s period, monetary policy shocks have no significant effects on output, despite large movements in credit costs. This finding is robust to alternative inference methods including weak identification, alternative measures of economic activity, policy indicator, external instrument, and different sample periods