This paper has adopted a Bayesian FAVAR approach to examine the monetary transmission mechanism in North Macedonia. The … have been evaluated. Our findings show that monetary tightening, causes a fall in output, inflation rate, employment, bank … lending, the stock of government securities held by banks, and equity prices. On the other hand, it increases shortterm money …

distribution with the monetary shock affecting the median household relative to the 20th percentile by a larger amount than the … right tail. Our results suggest that the shock is transmitted through changes in net property and financial wealth that …

it. If we do so prices change only every 50 weeks and the Calvo model overestimates the real effects of monetary shocks … by almost 70%. A second shortcut is to leave the temporary changes in the data. If we do so prices change every 3 weeks … can generate the same real effects as our benchmark model if we set parameters so that prices change every 17 weeks …