New Findings on Firm Investment and Monetary Policy Transmission in the Euro Area

Jean-Bernard Chatelain (1) , Andrea Generale (2) , Ignacio Hernando (3) , Philip Vermeulen (4) , Ulf von Kalckreuth (5)

1 CES - Centre d'économie de la Sorbonne
2 BI - Banca d´Italia
3 Bank of Spain
4 ECB - European Central Bank
5 Bundesbank

In this paper we present comparable results on the determinants of firms' investment and their link to monetary policy. The results have been obtained by the Eurosystem Monetary Transmission Network. This network has produced a series of papers in which the use of micro data permits estimating and quantifying the relevance of two channels of monetary policy transmission: the nterest rate and the broad credit channel. The research findings provide evidence of an operative interest rate channel in all countries examined. Moreover, the results indicate that variables which proxy firms' financial conditions play a role. Firms characterised by weaker balance sheets
show higher liquidity sensitivity.

Mots clés: investment; monetary transmission; user cost of capital

Mots clés: investissement; canaux de transmission de la politique monetaire; coût d'usage du capital

Domaines: Economies et finances

Jean-Bernard Chatelain, Andrea Generale, Ignacio Hernando, Philip Vermeulen, Ulf von Kalckreuth. New Findings on Firm Investment and Monetary Policy Transmission in the Euro Area. Oxford Review of Economic Policy, 2003, 19 (1), pp.1-11. ⟨halshs-00119490⟩