FINANCIAL FRAGILITY IN COLOMBIA AND THE MONETARY POLICY DECISIONS TAKEN BY THE CENTRAL BANK 1996–2012

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José Mauricio Gil León
Andrea Yaelt Lemus Vergara

Abstract

 This paper evaluates what has been the role of the monetary policy decisions taken by the Central Bank during the financial instability processes that Colombia has gone through during 1996 – 2012. According to the fact analysis, the 1999 crisis questioned the role of the central bank, which defended a counter-cyclic posture that was not strong enough to lead the economic recovery. The 2008 crisis found a stronger stand­ing Central Bank, even though it answered late to the emerging processes regarding financial fragility. With the use of econometric studies it was proven that a contractive monetary policy can accelerate a financial crisis when the measure is implemented in moments when the financial stress is too high.

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Author Biographies

José Mauricio Gil León, Universidad Pedagógica y Tecnológica de Colombia

Economista, Especialista en Finanzas y Magister en Economía de la Universidad Pedagógica y Tecnológica de
Colombia, Tunja, Colombia. Docente en el área de teoría económica de la Universidad Pedagógica y Tecnológica
de Colombia. Miembro del Grupo de Investigación OIKOS y EUGENE FAMA.

Andrea Yaelt Lemus Vergara, Pedagogical and Technological University of Colombia

Economista, Especialista en Planeación y Gestión del Desarrollo Territorial y Magister (c) en Economía Universidad
Pedagógica y Tecnológica de Colombia, Tunja, Colombia. Miembro del Grupo de Investigación OIKOS
y docente catedrática de la Universidad Pedagógica y Tecnológica de Colombia.

How to Cite

Gil León, J. M., & Lemus Vergara, A. Y. (2005). FINANCIAL FRAGILITY IN COLOMBIA AND THE MONETARY POLICY DECISIONS TAKEN BY THE CENTRAL BANK 1996–2012. Semestre Económico, 18(38), 37-66. https://doi.org/10.22395/seec.v18n38a2

References