The recent financial crisis has been characterized by unprecedented monetary policy interventions of central banks with the intention to stabilize financial markets and the real economy. This paper sheds light on the actual impact of monetary policy on stock liquidity and thereby addresses its role as a determinant of commonality in liquidity.

To capture effects both at the micro and macro level of stock markets, we apply panel estimations and vector autoregressive models. Our results suggest that an expansionary monetary policy of the European Central Bank leads to an increase of stock market liquidity in the German, French and Italian markets.

These findings are robust for seven proxies of liquidity and two measures of monetary policy. Evidence from the Euro Zone February 1, Subscribe to this fee journal for more curated articles on this topic.

The Impact of Monetary Policy on Stock Market Bubbles and Trading Behavior: Evidence from the Lab. By Urs Fischbacher , Thorsten Hens , Cookies are used by this site. To decline or learn more, visit our Cookies page. This page was processed by apollo1 in 0. Your Account User Home Personal Info Affiliations Subscriptions My Papers My Briefcase Sign out.

Download this Paper Open PDF in Browser Share: Using the URL or DOI link below will ensure access to this page indefinitely. Abstract The recent financial crisis has been characterized by unprecedented monetary policy interventions of central banks with the intention to stabilize financial markets and the real economy.

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EconPapers: Monetary policy and its impact on stock market liquidity: Evidence from the euro zone

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Monetary Policy and its Impact on Stock Market Liquidity: Evidence from the Euro Zone by Octavio Fernández-Amador, Martin Lukas Gächter, Martin Larch, Georg Peter :: SSRN

European Finance eJournal Follow. European Finance eJournal Subscribe to this fee journal for more curated articles on this topic FOLLOWERS. Marco Da Rin at Tilburg University, Department of Finance, Francesco Giavazzi at Bocconi University - Department of Economics. Recommended Papers The Impact of Monetary Policy on Stock Market Bubbles and Trading Behavior: Evidence from the Lab By Urs Fischbacher , Thorsten Hens , Eastern, Monday - Friday.

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