This dissertation consists of three essays. Chapter II uses the method of structuralfactor analysis to study the effects of monetary policy on key macroeconomic variablesin a data rich environment. I propose two structural factor models. One is the structuralfactor augmented vector...

The dissertation consists of three essays. Chapter II examines the asymmetriceffects of monetary policy on stock prices by using an unobserved components modelwith Markov-switching. My results show that monetary policy has negative effects onstock prices, which is consistent with the most recent...

In this dissertation, two questions concerning monetary policy under the Taylor rule have been addressed. The first question is on, under the Taylor rule, whether a central bank should be responsible for both bank supervision and monetary policy or whether the two tasks should be exercised by...

Monetary policy has been given either too many positive attributes or, in contrast, only economy-disturbing features. Central banks must take into account a wide variety of factors to achieve a proper characterization of modern economies for the optimal implementation of monetary policy. Such is...

The current discussion of Inflation Targeting (IT) in emerging economies deals with the effects that nominal exchange rate movements have on the overall inflation rate. The literature has focused in the analysis of the advantages and disadvantages that IT has with respect to other monetary...

Concerns have been raised in the media about a ‘one-size-fits-all’ monetary policy for the UK. If there are diverse economic conditions in different regions, then a unitary monetary policy cannot suit all. The purpose of this paper is to explore this issue further by breaking it down into...

This dissertation studies the relationship between the existence of multiple means of payment and the effects of monetary policy.Chapter 1 studies the choice of endogenous means of payment when holding money is risky. In steady state equilibrium, the marginal rate of substitution of cash goods...

This paper provides an empirical analysis of stock market reactions to monetary policy surprises. Its principal objective is to understand the heterogeneous nature of this type of response by examining a set of possible explanatory factors. I find that a hypothetical unanticipated increase of 25...