Prof. Dr. Abbas Kadhim Jassim Al-Da’ami, Researcher Hassan Mohammed Jawad Al-DaimiJOURNAL OF ADMINISTRATION AND ECONOMICS
2019, Volume 8, Issue 29, Pages 242-267

Abstract

The of research is to show the mechanism of the Favar model to show theimportance of the monetary policy tools in the performance indicators of the efficiency ofthe monetary policy presented by the model as indicators to measure the health of themacro economy and the extent of the impact of the tools of monetary authority whichvary from country to country according to the degree of economic and politicaldevelopment and the banking and financial sector, And activating monetary policy throughthe exercise of quantitative instruments and has an important role as a channel totransfer the monetary authority to the economy and the formulation and implementation ofmonetary policy, which are related to the extent of independence of the Central Bank andthe freedom to use the mixture of tools (The use of the Favar model to measure theeffect of monetary policy on performance indicators of monetary policy efficiency) in orderto study the relations between quantitative monetary power tools (re-discount rate,Reserve requirements, central bank purchases, central bank sales) and performanceindicators of US monetary policy efficiency for the period 1990-2017.The importance of the study is reflected in the presentation of economic views on thecourse of monetary policy and the reflection of tools in the economy through the transferof shocks of monetary policy to the economy through the indicators of the performance ofmonetary policy so as to strengthen the role of central banks in the formulation andimplementation of monetary policy because the impact of monetary shocks of monetarypolicy tools in the activity Economic policy is one of the most important topics inmacroeconomic analysis, where monetary policy is the most effective in achievingeconomic growth through the procedures and tools of the Central Bank to influence thelevel of economic activity. The monetary policy in the countries of the study sample andanalysis of the tools of the Central Bank and indicators of the performance of monetarypolicy for the period 1990-2017 and the definition of macroeconomic variables includedin the FAVAR model, which expresses the indicators of the performance of short and longterm monetary policy efficiency and the assessment and measurement of correlationbetween the tools of the Central Bank and efficiency performance indicators MonetaryPolicy for the period 1990 – 2017 and an analysis of the direction of the causal244relationship between the tools of the Central Bank and the indicators of thإ efficiency ofmonetary policy.