01774cas a2200241 a 4500 AALejournalIMF005491 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451871463 1018-5941 BD-DhAAL BD-DhAAL International Monetary Fund. Is Monetary Policy Effective When Credit is Low? Washington, D.C. : International Monetary Fund, 2008. 1 online resource (17 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Monetary policy, at least in part, operates through both an interest rate and credit channel. The question arises, therefore, whether monetary policy is a less potent a device in affecting output and inflation in countries that have low levels of credit and where investment and consumption are not financed by borrowing in local currency. This paper employs a Panel Vector Auto Regression approach to examine the empirical evidence in a broad sample of emerging market countries. The data suggests that the effectiveness of changes in policy interest rates in influencing the path of inflation appear to be unrelated to the level of credit and that, instead, the willingness to allow exchange rate flexibility is a far more important determining factor. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2008/288 Full text available on IMF http://elibrary.imf.org/view/journals/001/2008/288/001.2008.issue-288-en.xml IMF e-Library