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Publication - Dr Francesco Giovannoni

    Market concentration, macroeconomic uncertainty and monetary policy


    Giovannoni, F & Tena, JdD, 2008, ‘Market concentration, macroeconomic uncertainty and monetary policy’. European Economic Review, vol 52 (6)., pp. 1097 - 1123


    This paper studies the effect of market structure and macroeconomic uncertainty on the transmission of monetary policy. We motivate our analysis with a simple model which predicts that: 1) investment and production in more concentrated sectors are more affected by demand shocks and 2) high uncertainty makes investment and production more sensitive to demand shocks. The empirical analysis estimates the effect of monetary shocks on sectoral output for different sectors in the US using a structural vector autoregressive (VAR) approach. The results are generally consistent with the theoretical predictions.

    Full details in the University publications repository