Social and Behavioral Sciences Commons^™

The Impacts Of Negative Interest Rates On The Eurozone Economy, Cynthia Wang

2017 Undergraduate Awards

This thesis evaluates the effects of a monetary policy shock in the Eurozone. The investigation stems from the recent implementation of negative interest rates in select European countries and Japan. Impulse response functions are used to compare variable responses when not influenced by negative rates versus when significantly impacted by this monetary policy. The inconclusiveness in the comparison between these two models resulted in failing to reject the hypothesis that negative interest rates have yet to be successful in the Eurozone. However, any economy is a complicated environment that cannot be modelled precisely, as numerous other factors play a role …