| Research Abstract |
Recently, many empirical studies support the existence of a loan channel.
However, we can not tell yet whether a loan channel is more important than a deposit channel.
This is because the accumulation of the analysis to solve the problem of identification is insufficient. Romer and Romer (1990) studied both channels by focusing on the tightening periods in order to solve the problem. We developed this method. That is, we paid attention to the inter-war period in which financial intermediation deteriorated remarkably. As a result of examination of statistical data and descriptive documents, we can infer as follows. That is, in the inter-war period of Japan, the deterioration of financial intermediation reached a peak in 1927. Meanwhile, depression of real economy reached a bottom in 1930-1931. After all, even if a loan channel was significant, other factors are considered to have had dominant effects on real economy.
Next, we consider a reaction function of monetary policy.
There is a weak point in the method of Romer and Romer (1990). That is, when there is feedback to a financial policy from policy objectives, such as inflation, the problem of identification arises again.
In order to investigate a reaction function, we studied an inflation-targeting policy of Japan empirically.
Finally, we deal with derivatives. BIS report in 1994 reported some problems of monetary policy accompanied by the growth of derivatives. However, there are other factors which can be considered to have significant effects on monetary policy ; (1) Securities holding for the purpose of risk hedge, (2) Basal Accord, (3) derivatives trading through banks. However, empirical studies are future subjects.
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