Heterogeneity In The Transmission Process

Diploma Thesis from the year 2006 in the subject Economics - Finance, grade: 2, University of Frankfurt (Main), language: English, abstract: In the last years several studies in the last years analyzed the effects of financial friction in the transmission process of central banks. In this study these effects will be taken into regard for currency zones of the three major currencies: Euro, US Dollar and British Pound. The primary focus of the study will be a comparison between the Euro Area (EA) and the United States (US). These two regions are of a similar economical size, but they represent different financial systems. This implies, that they underlie different financial friction. The United Kingdom (UK) is taken into regard as it reflects an European economical and social system, but has an Anglo-Saxon financial system, which is strongly comparable to the United States. This enables us to use the UK to as a test sample, to investigate whether experienced responses in economic variables actually might relate to financial friction, or if they depend on other factors. This comparison will be part of the key point of this thesis as seen in the following analysis.