Measuring monetary policy shocks in the European Monetary Union

The paper tries to estimate whether a unique and centralized European monetary policy would have had similar or different effects across countries in the European Union. By estimating a vector auto-regression (VAR model), it is revealed that there are two different groups of countries with considerable differences in the response to changes in the monetary policy. Germany and the North-Central European countries would be less sensitive to these changes, whereas the Mediterranean countries (and Belgium) would be noticeably more sensitive to the mentioned variations.