Alternative monetary policy tools during the great recession

Abstract

The ever-increasing use of non-conventional monetary policy instruments has led to intensified interest in their effects on real economy. Taking this as my starting point, this paper aims to shed light on this question. Using a Structural VAR model for the Euro area during the period of 2003 until the first semester of 2017, I found that the implementation of Quantitative Easing was positive for the real economy, as it prevented a further reduction of real output and warded off the risk of disinflation.