Research Seminar of International Laboratory for Macroeconomic Analysis

On the 28th of November Alexander Myasnikov gave a presentation «Regional asymmetry of the effects of monetary policy: a spatial econometric approach» at the Research Seminar of International Laboratory for Macroeconomic Analysis.

Abstract:

We analyze the heterogeneous effects that monetary policy of the Russian central bank has had on the growth rates of real personal income in 79 Russian regions over the period from 2Q2015 to 4Q2019, taking into account transmission channels and spatial spillovers. Our results confirm a negative relationship between changes in the key rate and in the growth rates of real personal income in Russian regions; we also find significant spatial relationships, with neighboring Russian regions positively affecting the responses of each other to monetary shocks. Calculations of individual direct effects of changes in the key rate support the hypothesis of asymmetrical influence of changes in the key rate on the rates of growth in various regions. The following attributes of regional economies prove to be significant in determining their heterogeneous responses: the share of manufacturing and construction, the share of small businesses, and in some cases also regions’ export orientation.

Seminar recording