{
  "title": "Measuring and Mending Monetary Policy Effectiveness Under Capital Account Restrictions: Lessons from Mauritania",
  "publication": "IMF Working Papers, March 27, 2013",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/measuring-and-mending-monetary-policy-effectiveness-under-capital-account-restrictions-40428",
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  "summary": "I propose a new approach to identifying exogenous monetary policy shocks in low-income countries with capital account restrictions. In the case of Mauritania, a domestic repatriation requirement is the key institutional characteristic that allows me to establish exogeneity.",
  "sections": [
    {
      "heading": "Identification approach and institutional mechanism",
      "content": "- Proposes a new approach to identifying exogenous monetary policy shocks in low-income countries with capital account restrictions.\n- Identifies a domestic repatriation requirement in Mauritania as the key institutional characteristic that allows establishment of exogeneity."
    },
    {
      "heading": "Data and empirical methods",
      "content": "- Uses a unique bank-level dataset on monthly balance sheets of six Mauritanian banks over the period 2006–11.\n- Empirical methods:\n  - Structural vector autoregressions.\n  - Two-stage least square panel models."
    },
    {
      "heading": "Main empirical findings",
      "content": "- Unlike in advanced countries, finds no evidence for a statistically significant impact of exogenous monetary policy shocks on bank lending.\n- Demonstrates the ineffectiveness of monetary policy in the Mauritanian context using the specified dataset and methods."
    },
    {
      "heading": "Policy recommendations and channels to improve effectiveness",
      "content": "- Reduction in banks’ loan concentration ratios to broaden credit distribution and reduce impediments to transmission.\n- Improvements in the liquidity management framework to enhance banks’ responsiveness to monetary stimuli.\n- Implicitly highlights the importance of banks’ liquidity position, excess reserves, refinancing possibility, and risk management capability for effective monetary transmission."
    },
    {
      "heading": "Key publication metadata and descriptors",
      "content": "- Author: Robert Blotevogel\n- Date: March 27, 2013\n- Pages: 35\n- Volume: 2013\n- Issue: 077\n- Series: Working Paper No. 2013/077\n- DOI: https://doi.org/10.5089/9781484328682.001\n- ISBN: 9781484328682\n- ISSN: 1018-5941\n- Subject and keywords include: Agroindustries, Bank credit, Banking, Credit, Economic sectors, Exports, Financial institutions, International trade, Loans, Money; and terms such as balance sheet equity, bank reserves, capital account restrictions, central bank, excess reserves, exogenous monetary policy shocks, liquidity management, loan concentration, loan portfolio, low-income countries, monetary policy effectiveness, monetary policy shock, private-sector credit, refinancing possibility, risk management capability, transmission mechanism.\n\nIMF Working Paper — \"Measuring and Mending Monetary Policy Effectiveness Under Capital Account Restrictions: Lessons from Mauritania\", Robert Blotevogel, March 27, 2013.\n\n---\n\n Content in this bundle\n\n- wp1377\n  - wp1377 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - wp1377 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/measuring-and-mending-monetary-policy-effectiveness-under-capital-account-restrictions-40428"
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    "Authors: Robert Blotevogel",
    "Published: March 27, 2013",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781484328682.001",
    "Proposes a new approach to identifying exogenous monetary policy shocks in low-income countries with capital account restrictions.",
    "Identifies a domestic repatriation requirement in Mauritania as the key institutional characteristic that allows establishment of exogeneity.",
    "Uses a unique bank-level dataset on monthly balance sheets of six Mauritanian banks over the period 2006–11.",
    "Empirical methods:",
    "Unlike in advanced countries, finds no evidence for a statistically significant impact of exogenous monetary policy shocks on bank lending.",
    "Demonstrates the ineffectiveness of monetary policy in the Mauritanian context using the specified dataset and methods.",
    "Reduction in banks’ loan concentration ratios to broaden credit distribution and reduce impediments to transmission.",
    "Improvements in the liquidity management framework to enhance banks’ responsiveness to monetary stimuli.",
    "Implicitly highlights the importance of banks’ liquidity position, excess reserves, refinancing possibility, and risk management capability for effective monetary transmission.",
    "Author: Robert Blotevogel",
    "Date: March 27, 2013",
    "Pages: 35",
    "Volume: 2013",
    "Issue: 077",
    "Series: Working Paper No. 2013/077",
    "DOI: https://doi.org/10.5089/9781484328682.001",
    "ISBN: 9781484328682",
    "ISSN: 1018-5941",
    "Subject and keywords include: Agroindustries, Bank credit, Banking, Credit, Economic sectors, Exports, Financial institutions, International trade, Loans, Money; and terms such as balance sheet equity, bank reserves, capital account restrictions, central bank, excess reserves, exogenous monetary policy shocks, liquidity management, loan concentration, loan portfolio, low-income countries, monetary policy effectiveness, monetary policy shock, private-sector credit, refinancing possibility, risk management capability, transmission mechanism.",
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