Working Papers, Department of Economics, Lund University
Regional Effects of Monetary Policy in Sweden
Abstract: This paper investigates the effects on employment in 21
Swedish regions of a monetary policy shock using a VAR model with exogenous
foreign variables for the 1993:1-2007:4 period. The regional impulse
responses clearly indicate asymmetric effects in which employment falls
significantly in some regions, while not changing significantly in others.
These differences seem to stem from the interest and exchange rate channel,
whereby regions with larger shares of employment in the goods sector and
higher export intensity are adversely affected. In addition, there is one
group of regions that, surprisingly, see increased employment in response
to the same policy shock.
Keywords: monetary transmission; vector autoregression (VAR); regional differences; (follow links to similar papers)
JEL-Codes: C32; E52; F41; (follow links to similar papers)
32 pages, April 28, 2012, Revised March 1, 2013
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