BOK Working Paper No.2023-12, Financial Technologies and the Effectiveness of Monetary Policy Transmission | (상세) |  Bank of Korea
Central bank: bok | Type: statement | Date: 2023-07-21

BOK Working Paper No.2023-12, Financial Technologies and the Effectiveness of Monetary Policy Transmission
2023.07.21
Monetary Policy
Financial Technology
Interacted Panel VAR
Bank Loan Growth
Macroeconomic Studies Team(02-759-5349)
Attachment
BOK Working Paper No.2023-12_Updated.pdf
BOK Working Paper No.2023-12_Online Appendix.pdf
Updated the revised version of the working paper on December 20, 2023.
Title : Financial Technologies and the Effectiveness of Monetary Policy Transmission
Author : Iftekhar Hasan(Fordham University), Boreum Kwak(BOK), Xiang Li(Halle Institute for Economic Research, Martin Luther University)
This study investigates whether and how financial technologies (FinTech) influence the effectiveness of monetary policy transmission. We use an interacted panel vector autoregression model to explore how the effects of monetary policy shocks change with regional-level FinTech adoption. Results indicate that FinTech adoption generally mitigates monetary policy transmission to real GDP, consumer prices, bank loans, and housing prices, with the weakened transmission to bank loan growth being the most pronounced. The relaxed financial constraint, regulatory arbitrage, and intensified competition are the possible mechanisms underlying the mitigated transmission.