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Asymmetric effects of monetary policy in ASEAN-4 economies


Tan, Siow Hooi and Habibullah, Muzafar Shah and Mohamed, Azali (2010) Asymmetric effects of monetary policy in ASEAN-4 economies. International Research Journal of Finance and Economics (44). pp. 30-42. ISSN 1450-2887


By employing the Markov-switching model, this study examines if real output asymmetrically responds to monetary policy shocks in Indonesia, Malaysia, the Philippines and Thailand. This study provides evidence that a contractionary monetary policy has a larger absolute impact than an expansionary policy. Moreover, the effects of an expansionary policy are gradually mitigated when the inflation rate is increasing (except in Malaysia). These findings imply that monetary authorities must consider not only the behaviour of the inflation process but also the fact that not all economies can react in a similar way to expansionary and contractionary monetary policy shocks.

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Additional Metadata

Item Type: Article
Divisions: Faculty of Economics and Management
Publisher: EuroJournals Publishing
Keywords: Monetary policy; Markov-switching; Asymmetry; ASEAN
Depositing User: Azana Abd Hadi
Date Deposited: 10 Feb 2015 02:17
Last Modified: 12 Jan 2016 08:34
URI: http://psasir.upm.edu.my/id/eprint/22742
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