The long-run effects of monetary policy shocks: Theory and empirical evidence.

While it is widely accepted that monetary policymakers are able to stimulate or cool down an economy in the short term, according to theory their influence becomes limited over longer periods of time. Over the years, some economists have started to gather evidence against this thesis and proposed a case for long-term effects of monetary policy. Starting from the traditional economic view, this dissertation aims to provide a review of the emerging literature that challenges monetary long-term neutrality. Additionally, this paper includes an empirical analysis to verify whether monetary policy shocks have long-term effects on the natural interest rate and other variables via SVARs à la Plagborg-Moeller and Wolf (2021).