there seems to be a negative relationship between the variance of regional output and the
regional output average growth rate, while no conclusion can be extracted from the existing
relationships between responses to monetary policy and inflation. In this sense, the obtained
results suggest that the potential risk of increasing asymmetries as a result of differences in
the transmission of a common monetary policy at a European level can be real. As under a
higher real asymmetry, macroeconomic adjustment would be more difficult under EMU, it
seems clear that any reform addressed to increase the efficiency of financial and monetary
markets could help to reduce the adverse effects of a single monetary policy (see European
Commission, 1997 and Costas and Bel, 1998). The main objective of these economic policies
would be to reduce the risk of “policy-induced” asymmetric shocks.
Figure 7. Relationship between the average inflation and the indicator of monetary policy
relative responses
,074
,072
,070
,068
,066
,064
,062
,060
,058
MAD
-20 -10
PV
MUR AGALP
AST
BAL
CAN
CAT
ARA
VAL NAV
CAST-L
EXCAN T
CAST-M
10
20
Indicator
R2=0,05
INF = 0,06 + 0,1∙10-3∙IND + e
(0.7∙10-3) (0.1∙10'3)
17
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