Working Papers

July 2013, No. 13-07R

A Monetarist Critique of ECB Monetary Policy in the Great Recession (Revised February 2015)

Robert L. Hetzel

Since 2008, the Eurozone has undergone two recessions, which together constitute the Great Recession. The explanation offered here attributes them to contractionary monetary policy. The New Keynesian model provides the framework for identifying the precipitating shocks as monetary.


*This paper was previously published under the title "Contractionary Monetary Policy Caused the Great Recession in the Eurozone: A New Keynesian Perspective."

Our Research Focus: Inflation and Monetary Policy

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