Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/278354 
Year of Publication: 
2023
Series/Report no.: 
ECB Working Paper No. 2778
Publisher: 
European Central Bank (ECB), Frankfurt a. M.
Abstract: 
We study how monetary policy affects local market competition in a union of countries experiencing different economic conditions: the euro area. We find that when monetary conditions tighten (loosen), from the point of view of an individual economy, market concentration increases (declines). This effect is more pronounced when interest rates have been low-for-long, and it is stronger in sectors that are relatively more sensitive to changes in financing conditions. The underlying mechanism is a decline (increase) in short-term debt and investment by smaller and medium-size firms, relative to large firms, following monetary policy tightening (easing).
Subjects: 
Eurozone
Monetary Union
Monetary Policy
Low Interest Rates
Competition
JEL: 
E2
G1
G12
Persistent Identifier of the first edition: 
ISBN: 
978-92-899-5520-1
Document Type: 
Working Paper

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