Contents
Two methods of monetary control in Korea : an evaluation of their effectiveness / 金昌埈 1
I. Introduction 1
I.1. Monetary control in Korea 1
I.2. About control methods 2
a) Definition of control methods 2
b) About treatment of bank credit 4
II. Two methods of monetary control 5
II.1. Relationship between momey, bank credit and monetary base 5
a) Multiplier approach 5
b) Bruner-meltzer money supply approach 6
II.2. Working of the two methods 7
a) The indirect method 7
b) The direct method 8
II.3. Supports and criticisms 9
a) Case for the indirect method 9
b) Case for the direct method 10
III. Tests of effectiveness 11
III.1. Efficiency of a control method 11
a) Choice of a control method 11
b) Accuracy of multiplier forecasting 12
III.2. Predictability of the multipliers 13
a) Methods of forecasting the multipliers 13
b) Results of the tests 15
III.3. Strength of the impacts 16
a) Measurement of the impacts 16
b) Result of the tests 17
IV. Conclusion 17
Appendix 1. 18
Appendix 2. 19
References 20